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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Information asymmetry is not a problem when:
A. the wants of both parties are aligned with one another. B. the wants of both parties are opposed to one another. C. the constraints of both parties are identical. D. both parties lack the same information.
How is leisure counted in GDP?
A. a consumption B. as investment C. it is not counted in GDP D. as an intermediate good
For a monopolist, if total revenue increases as output decreases, then marginal revenue is
A. positive. B. equal to price. C. zero. D. negative.
Central bankers with a relatively steep monetary policy reaction curve will:
A. move interest rates more aggressively when inflation rises, leading to more volatility in output. B. move interest rates less aggressively when inflation rises, leading to less volatility in output. C. move interest rates more aggressively when inflation rises, leading to less volatility in output. D. move interest rates less aggressively when inflation rises, leading to more volatility in output.