Under the Bretton Woods system, whenever a country ran a short-term balance of payments deficit, it was:
A. obliged to contract its money supply.
B. obliged to expand its money supply.
C. possible for it to borrow from the IMF.
D. likely to increase the value of its currency.
Answer: C
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How does an increase in the price level affect the aggregate planned expenditure curve and the aggregate demand curve?
What will be an ideal response?
Consider an industry that is in long-run equilibrium. An increase in demand leads to an increase in the price of the good. We know that this is
A) a decreasing cost industry. B) a constant cost industry. C) an increasing cost industry. D) not a competitive industry.
Automated production methods are only attractive when they
a. are undertaken in heavily unionized sectors of the economy. b. reduce per-unit costs. c. replace workers. d. decrease labor productivity.
Which industry or sector of the economy would least likely be affected by the business cycle?
A. Automobiles B. Capital goods C. Services D. Consumer durables