What is the shape of the modern short-run aggregate supply (SRAS) curve? Why?
What will be an ideal response?
The short-run aggregate supply curve is initially horizontal, then upward sloping. If the price level increases in the short run, some costs for firms stay constant. The higher product price leads to higher profits, and the firms expand production. Hence, aggregate output can increase in the short run.
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If cameras and film have a cross elasticity of .985, they are complements
Indicate whether the statement is true or false
Assume that the expectation of a recession next year causes business investments and household consumption to fall, as well as the financing to support it. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the real exchange rate and the monetary base in the context of the Three-Sector-Model? Assume the nominal exchange rate is stated
as: (foreign currency per domestic currency). a. The real exchange rate rises and monetary base rises. b. The real exchange rate falls and monetary base falls. c. The real exchange rate rises and monetary base falls. d. The real exchange rate and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
A higher interest rate makes _____ more attractive. Therefore the quantity of loanable funds supplied increases
Fill in the blank(s) with correct word
What is the difference in the quantity of coffee demanded in Quahog when the price changes from $4 per pound to $3 per pound?
a. The quantity decreases by 1,990 pounds per year.
b. The quantity increases by 1,990 pounds per year.
c. The quantity decreases by 2,000 pounds per year.
d. The quantity increases by 2,000 pounds per year.