In the Keynesian model deviations of output from potential are caused by:
A. fluctuations in aggregate spending.
B. fluctuations in average labor productivity.
C. changing asset prices.
D. technological change.
Answer: A
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The above figure shows the short-run production function for Albert's Pretzels. The law of diminishing marginal productivity
A) appears with the second worker. B) has not yet appeared for any of the levels of labor. C) first appears with the fifth worker. D) is refuted by this evidence.
.In the aggregate demand-aggregate supply model, the short-run effects of an unanticipated decrease in the money supply will be
What will be an ideal response?
When the Fed wants to expand the money supply through open-market operation, it
A. sells government securities to the Treasury. B. sells government securities to member banks. C. buys government securities from member banks. D. buys government securities from the Treasury.
When the price level rises, the quantity of real GDP demanded will _________
Fill in the blank(s) with the appropriate word(s).