The economy suffers an adverse supply shock. As a result, in the short run Real GDP will __________ and the price level will __________
A) rise; rise
B) fall; fall
C) fall; remain constant
D) fall; rise
E) rise; fall
D
You might also like to view...
M1 is larger than M2
Indicate whether the statement is true or false
A perfectly competitive firm is producing more than the profit-maximizing amount of its product. You can conclude that its
A) total cost exceeds its total revenue. B) average total cost exceeds the price of the product. C) marginal revenue is less than the price of the product. D) marginal cost exceeds the price of the product.
One way to solve the problems caused by information asymmetry is:
A. surfing. B. signaling. C. proofing. D. All of these are solutions to information asymmetry.
Which of the following tends to make demand for a good more elastic?
a. A reduction in the number of substitutes for the good. b. Consumers have a long time to adjust to a price change. c. The amount spent on the good is a small proportion of the consumer's budget. d. The good is broadly defined. e. The good is a necessity.