Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the short run would be:
A. P1 and Y2.
B. P3 and Y1.
C. P2 and Y2.
D. P2 and Y3.
Answer: D
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Which of the following statements is correct?
A) New classicals believe that the aggregate supply curve is vertical in the short run. B) New Keynesians believe that the aggregate supply curve is vertical in the short run. C) New Keynesians believe that the aggregate supply curve slopes upward in the long run. D) New classicals believe that the aggregate supply curve slopes upward in the short run.
Identify the "oversimplified multiplier formula."
a. Multiplier = 1 divided by (1 ? change in GDP) b. Multiplier = 1 divided by (1 ? marginal propensity to consume) c. Multiplier = 1 divided by (1 ? marginal propensity to save) d. Multiplier = 1 divided by (1 ? rate of inflation)
Patents, copyrights, and trademarks
a. are examples of government-created monopolies. b. allow their owners to reduce the costs of what they produce. c. generate more revenue for the government than they cost consumers in the form of higher prices. d. All of the above are correct.
Wealth is a flow measure.
Answer the following statement true (T) or false (F)