Exhibit 14A-1 Aggregate demand and supply model
Given the shift of the aggregate demand curve from AD1 to AD2 in Exhibit 10A-1, the real GDP and price level (CPI) in long-run equilibrium will be:
A. $8 billion and 150.
B. $12 billion and 200.
C. $8 billion and 250.
D. $8 billion and 200.
Answer: C
You might also like to view...
Price elasticity of supply:
A. is the percentage change in the quantity supplied of a good or service divided by the percentage change in the price of the good or service. B. measures consumers' responsiveness to a change in price. C. is always a negative number. D. is the percentage change in the price of a good or service divided by the percentage change in the quantity supplied of the good or service.
If you must make a choice about consuming two apples, three oranges, or one candy bar, the opportunity cost of the candy bar is:
a. two apples. b. three oranges. c. two apples and three oranges. d. two apples or three oranges, whichever you prefer more. e. equal to the difference in the prices of the three options.
Suppose you sell a kayak for $600, but you were willing to sell it for $450 . The buyer was willing to pay $650 . The total surplus is $200
a. True b. False Indicate whether the statement is true or false
The more the short-run output exceeds the economy's potential, the ________ the expansionary gap and the ________ the upward pressure on the price level
a. larger; greater b. smaller; lesser c. larger; lesser d. smaller; greater