When PAE decreases then the economy will move towards:
A. constant levels of GDP.
B. higher levels of equilibrium aggregate expenditure.
C. lower levels of equilibrium GDP.
D. higher levels of equilibrium GDP.
Answer: C
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If a firm takes the wage as given, then the firm's marginal expenditure on labor curve is
A) above the labor supply curve. B) below the labor supply curve. C) the same as the labor supply curve. D) upward sloping.
The Sugar Act (1764):
a. decreased the tariff that had been established by the Molasses Act. b. was designed to raise revenue for England. c. was more vigorously enforced than the Molasses Act. d. was designed to support England's mercantilist goals. e. All of the above.
Using Figure 1 above, if the aggregate demand curve shifts from AD2 to AD3 the result in the short run would be:
A. P1 and Y2. B. P2 and Y3. C. P3 and Y1. D. P2 and Y2.
In the above figure, the curve that represents the most income equality is
A. a. B. b. C. c. D. d.