When the Central Bank acts in a way that causes the money supply to increase while aggregate demand remains unchanged, it is:
a. following a contractionary monetary policy.
b. following quantitative easing policy.
c. following a tight monetary policy.
d. following an expansionary monetary policy.
d. following an expansionary monetary policy.
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In the figure above, at the point where the price is $4 per cup the price elasticity of demand is
A) 2. B) 0.5. C) 1. D) 1.5. E) 0.
A line that represents combinations of two goods that a consumer can purchase with a fixed income and given price for each good is called the:
a. indifference curve. b. demand curve. c. budget line. d. money line.
A rise in price almost always:
a. leads to an increase in the quantity supplied of that good or service. b. leads to a decrease in the quantity supplied of that good or service. c. has no effect on the quantity supplied of that good or service. d. leads to an increase in the quantity demanded of that good or service.
If a component of aggregate demand increases,
A) GDP in the United States is likely to increase less than that component of spending increased. B) GDP in the United States is likely to increase more than that component of spending increased. C) GDP in the United States is likely to decrease. D) GDP in the United States will not change.