Which of the following statements is correct?
A) The price level does not affect the level of real GDP demanded.
B) The lower the price level, the more the aggregate demand curve shifts rightward.
C) The lower the price level, the greater the quantity of real GDP demanded.
D) The higher the price level, the more the aggregate demand curve shifts rightward.
E) The lower the price level, the more the aggregate demand curve shifts leftward.
C
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Helen gives up the opportunity to bake 40 cakes for each room she paints; Josh can paint one room in the time it takes him to bake 60 cakes. The opportunity cost of a cake for Josh is
a. painting one room b. painting 1/40 of a room c. painting 1/60 of a room d. painting 2/3 of a room e. painting 3/2 of a room
An appropriate Keynesian response to an inflationary gap is to: a. decrease net taxes
b. decrease government spending. c. decrease interest rates. d. decrease the cash reserve ratio.
The amount by which total utility rises when an additional unit of a good is consumed is called:
a. average utility b. the law of diminishing returns c. incremental utility d. marginal utility
Suppose all 18-year-olds are identical in every way except that some have easy access to credit (i.e., they face a low interest rate when borrowing money) while others have a difficult time accessing credit (i.e., they face a high interest rate when borrowing money). Which of the following statements is not true?
A. Those who have easy access to credit have a lower rate of discount than those who do not have easy access to credit. B. Those who have easy access to credit will be more likely to go to college than those who do not have easy access to credit. C. No one without easy access to credit will go to college. D. Some people who have easy access to credit will not go to college. E. The present value calculation of college will be higher for those who have easy access to credit than for those who do not have easy access to credit.