Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential
B. higher; higher
C. lower; higher
D. higher; potential
Answer: D
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Refer to the table above. The opportunity cost per dollar of value added in stitching shoes by workers in Eduland is ________
A) $0.25 B) $0.50 C) $2 D) $4
Define the following terms and explain their importance to the study of macroeconomics:
a. aggregation b. recession c. gross domestic product d. final goods and services e. stabilization policy
If demand is price inelastic, then
a. buyers do not respond much to a change in price. b. buyers respond substantially to a change in price, but the response is very slow. c. buyers do not alter their quantities demanded much in response to advertising, fads, or general changes in tastes. d. the demand curve is very flat.
In response to a decrease in output, the economy would revert to its original level of prices and output whether the decrease in output was caused by a decrease in aggregate demand or a decrease in short-run aggregate supply
a. True b. False Indicate whether the statement is true or false