Using Figure 1 above, if the aggregate demand curve shifts from AD2 to AD1 the result in the long run would be:
A. P4 and Y1.
B. P4 and Y2.
C. P5 and Y1.
D. P5 and Y2.
Answer: D
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What will be an ideal response?
Have Malthus' predictions about population growth come true?
A) no, because modern birth control has limited population growth in all nations B) yes, as evidenced by the famine and food shortages affecting every nation today C) no, because the world's food supply has grown much more rapidly than Malthus foresaw D) Yes. The world's food supply, measured by calories per person, continues to fall.
The age-earning cycle usually begins
A) at relatively high income levels. B) at relatively low income levels. C) once a worker reaches 25 years of age. D) only when a worker is employed full time.
The amount of reserves in the economy is often determined by the amount of money in the economy that will achieve a particular interest rate. This reflects the fact that the money supply is:
A. endogenous. B. implicit. C. extrapolative. D. fiat.