Aggregate supply in the new classical aggregate supply
a. is vertical in the short-run.
b. is horizontal in the short-run.
c. is upward sloping in the short-run.
d. None of the above
C
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Gertie saw a pair of jeans that she was willing to buy for $35. The price tag said they were $29.99. Therefore:
A. Gertie should buy the jeans because the price is more than her reservation price. B. Gertie should not buy the jeans because they will be of lower quality than she expected. C. Gertie should buy the jeans because the price is less than her reservation price. D. Gertie should not buy the jeans because the price is not equal to her reservation price.
Private ownership and competitive markets are important for economic growth because they provide individuals with a strong incentive to:
a. care for resources and use them beneficially. b. innovate and introduce new products that are highly valued relative to their cost. c. produce goods efficiently. d. all of the above are correct.
Suppose a student group from your university tours the United Kingdom. As they purchase English goods, their actions will
a. create a demand for dollars and a supply of English pounds in the foreign exchange market. b. create a demand for English pounds and a supply of dollars in the foreign exchange market. c. cause the U.S. dollar to appreciate. d. cause the English pound to depreciate.
Explain and show graphically how a decrease in government spending affects the equilibrium interest rate and equilibrium quantity of loanable funds in the market for loanable funds
What will be an ideal response?