Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward
B. Short-run aggregate supply shifting upward
C. Short-run aggregate supply shifting downward
D. Aggregate demand shifting leftward
Answer: B
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Refer to Figure 3-4. At a price of $20, how many units will be supplied?
A) 400 B) 500 C) 600 D) 800
Expansionary fiscal policy leads to
A) lower exchange rates, increased exports, and increased imports. B) higher exchange rates, decreased exports, and decreased imports. C) lower exchange rates, decreased exports, and decreased imports. D) higher exchange rates, decreased exports, and increased imports.
Many economists believe that if fiscal policy turns contractionary to reduce the deficit,
A. monetary policy can turn expansionary to counteract the effects on aggregate demand. B. monetary policy must be contractionary to reinforce the good effects of contractionary fiscal policy. C. foreign investment in the United States must be encouraged. D. taxes on the earnings from stock market gains should be increased.
What is TRUE about government budget deficits and surpluses since 1940?
A. There have been more government budget deficits than government budget surpluses. B. Balanced budgets have been more common than government budget deficits or government budget surpluses. C. The number of government budget deficits is about the same as the number of government budget surpluses. D. There have been more government budget surpluses than government budget deficits.