The aggregate demand curve gives
A. the total value of nominal GDP in an economy for a year, holding income and technology constant.
B. the total amount of real domestic output that will be purchased at each price level.
C. the total amount of nominal domestic income that will be purchased at each price level.
D. the total value of output produced by workers in both foreign and domestic markets at each price level.
Answer: B
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Consider a BMW automobile plant. If the price of BMWs increase by 10 percent and the money wage rate and other costs ________, there will be ________
A) increase by 10 percent; an increase in BMWs profits B) do not change; an increase in BMW's production and profit C) increase by 10 percent; an increase in BMWs production D) do not change; no change in production
File-sharing programs such as Napster, Kazaa, and iMesh make it possible for individuals to exchange music files over the Internet
All else constant, which of the following statements best describes how the development of these programs has affected the retail market for new music CDs? A) Demand for CDs has decreased, causing equilibrium price and quantity to decrease. B) Demand for CDs has increased, causing equilibrium price and quantity to increase. C) Demand for CDs has decreased, causing equilibrium price to decrease and equilibrium quantity to increase. D) Demand for CDs has increased, causing equilibrium price to increase and equilibrium quantity to decrease.
Which of the following statements best illustrates the concept of derived demand?
A. As income goes up, the demand for farm products will increase by a smaller relative amount. B. A decline in the price of margarine will reduce the demand for butter. C. A decline in the demand for shoes will cause the demand for leather to decline. D. When the price of gasoline goes up, the demand for motor oil will decline.
The velocity of money is the:
A. relationship between the money supply and the price level. B. number of times per year the average dollar is spent on final goods and services. C. relationship between asset and transactions demands for money. D. price level divided by aggregate supply.