A quantity restriction decreases the price of the product and the quantity produced.
Answer the following statement true (T) or false (F)
False
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Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
In the basic closed-economy ISLM model, the money market can be described by the
A) money demand function. B) money supply. C) money market equilibrium condition. D) all of the above.
When the U.S. dollar drops in value exports tend to:
A. go up, which decreases the trade deficit. B. fall, which increases the trade deficit. C. go up, which increases the trade deficit. D. fall, which decreases the trade deficit.
When policy makers choose between tax policy and spending policy to affect the level of aggregate demand, they tend to choose on the basis of
a. how large a public sector they want. b. how much they want to change aggregate demand. c. how much they want to change aggregate supply. d. which has the larger multiplier.