Suppose the shift from AD0 to AD1 and from AS0 to AS1 is the result of fiscal policy
If the effect on aggregate supply was larger than the figure above shows, as a result the price level would be ________ 110 and real GDP would be ________ $17 trillion.
A) equal to; equal to
B) equal to; larger than
C) higher than; larger than
D) smaller than; less than
E) smaller than; larger than
E
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Which of the following best defines an expansion?
a. Real GDP is below its potential level. b. Real GDP is increasing. c. Unemployment is unusually high. d. Real GDP is decreasing. e. Real GDP exceeds its potential level.
Exhibit 12-2 Lorenz curve
As shown in Exhibit 12-2, 60 percent of families earned a cumulative share of about ____ of income.
A. 5 percent B. 15 percent C. 30 percent D. 50 percent
Classical economists believed that:
A. price flexibility automatically directs market economies to full employment. B. budget deficits and surpluses were necessary for the control of economic fluctuations. C. market economies suffer prolonged periods of recessions and depressions. D. market economies are inherently unstable because of fluctuating aggregate demand.
In an economy where firms in most industries are monopolistically competitive firms, individual firms in each industry would produce ________ products and have a ________ share of industry output.
A. differentiated; large B. differentiated; small C. standardized; small D. standardized; large