How are demand-pull and cost-push inflation reflected in terms of the AD-AS model?
What will be an ideal response?
Demand-pull inflation is reflected as a rightward shift of the AD curve that expands real GDP but also increases the price level. Cost-push inflation is reflected as a leftward shift of the AS curve which drives the price level up.
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The price that we observe in the market is
A) the law of demand. B) a substitute. C) the money price. D) the relative price.
The ability of a firm to maintain a price above the competitive level without losing all its customers to rival firms is termed as ________
a. competition b. marginal cost pricing c. allocative efficiency d. market power
One goal of rate-of-return regulation is the prevention of
A) free market entry. B) positive economic profits. C) poor quality service. D) environmental degradation.
A reduction in the amount of farmable land inside a nation would cause the:
A. long-run aggregate supply curve to shift to the right. B. long-run aggregate supply curve to shift to the left. C. short-run aggregate supply curve to shift to the right. D. aggregate demand curve to shift to the right.