The primary purpose of the aggregate demand and aggregate supply model is to demonstrate the classical dichotomy
a. True
b. False
Indicate whether the statement is true or false
False
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A neighbor slips on an icy sidewalk in front of your house, resulting in $500 of medical bills. The court rules that the accident had a 20% chance of occurring. Under a negligence standard, you will be held liable for damages if removing the ice from the sidewalk would have cost you less than
a. $20. b. $100. c. $500. d. $1,000.
If you divide the amount of nominal GDP by the stock of money, you have computed the
a. multiplier. b. price level. c. velocity of circulation. d. inflation rate.
A situation in which output decreases while prices increase is often referred to as:
A. inflation. B. negative economic growth. C. a recession. D. stagflation.
Suppose Brad Pitt and Angelina Jolie wear matching platinum jewelry in their new movie. After the movie is released, suppose that consumers increase their demand for the jewelry and at the same time manufacturers increase the supply of the jewelry. As a result
A) the equilibrium quantity will increase, and there is an indeterminate change in the equilibrium price. B) the equilibrium quantity and price are both indeterminate. C) the equilibrium quantity will decrease, and the equilibrium price will increase. D) the equilibrium price and quantity will both decrease.