The interest-rate effect
a. depends on the idea that decreases in interest rates increase the quantity of goods and services demanded.
b. depends on the idea that decreases in interest rates decrease the quantity of goods and services demanded.
c. is responsible for the downward slope of the money-demand curve.
d. is the least important reason, in the case of the United States, for the downward slope of the aggregate-demand curve.
a
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
The figure above shows the cost, marginal revenue, and demand curves of Golden Chow, a producer of dog food. The market for dog food is monopolistic competition. In the short run, Golden Chow sells 400 cans of dog food per day and makes ________
Other firms have ________ incentive to enter the industry. A) an economic profit of $200 a day; an B) an economic profit of $400 a day; an C) a normal profit of $200 a day; no D) an economic profit of $400 a day; no
An increase in the money supply will raise equilibrium GDP if the
A) IS curve is not vertical. B) IS curve is negatively sloped. C) position of the IS curve depends on the level of real money balances. D) position of the LM curve depends on the level of real money balances.
Both a defendant and plaintiff believe there is a 30 percent chance that the plaintiff will win $150,000 and a 70 percent chance that the plaintiff will lose and be awarded nothing (zero). If the plaintiff's litigation cost is $30,000 and the defendant's litigation cost is $40,000, the defendant would be willing to pay any amount up to ________ to settle and the plaintiff would be willing to
accept any amount greater than ________ to settle. A) $80,000; $20,000 B) $20,000; $80,000 C) $85,000; $15,000 D) $15,000; $85,000