Because increases in inflation reduce aggregate spending and short-run equilibrium output:
A. the aggregate demand curve is horizontal.
B. the aggregate demand curve is downward sloping.
C. the aggregate demand curve is upward sloping.
D. the short-run aggregate supply line is downward sloping.
Answer: B
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When considering the velocity of money, the Federal Reserve is most concerned about its
A) stability. B) absolute size. C) determinants. D) sign.
Use the above table. What will the output level be when external costs are internalized with a tax?
A) 4 B) 5 C) 6 D) 7
A monopolist will maximize profits by
a. setting the price at the level that will maximize per-unit profit. b. producing the output where marginal revenue equals total cost and charging a price along the demand curve. c. selling at the price on the demand curve at the output rate where marginal revenue equals marginal cost. d. producing at the output rate where price equals marginal cost.
Answer the following statement(s) true (T) or false (F)
1. Economists agree that setting a minimum wage causes some unemployment. 2. Private-sector unions are the main cause of unemployment in the United States. 3. Unemployment insurance is thought to increase the rate of unemployment. 4. Technological advances generally reduce unemployment in the short term. 5. The prices of some goods and services can fall during inflation.