On a traditional supply and demand diagram,
A. price is measured along the horizontal axis and quantity along the vertical axis.
B. price is measured along the vertical axis and quantity along the horizontal axis.
C. quantity demanded is measured along the horizontal axis, quantity supplied is measured along the vertical axis, and price is indicated on the contour lines.
D. quantity is measured along both axes and price is indicated on the contour lines.
Answer: B
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In the above figure, the economy is at point A when changes occur. If the new equilibrium has a price level of 100 and real GDP of $17.0 trillion, then it must be the case that
A) aggregate demand has decreased. B) aggregate supply has decreased. C) aggregate demand has increased. D) aggregate supply has increased.
Identify the comovement (i.e., direction and timing) of the following variables over a business cycle:
(a) industrial production (b) unemployment (c) nominal interest rates (d) nominal money supply growth (e) investment
Suppose you are an attorney, and you are defending a client in a wrongful death suit
The deceased was a pilot for an aerial acrobatics team, and the opposing attorney has prepared an an estimate of the value of lost income that includes the mortality rate for all pilots. You should argue that the attorney's estimate of lost earnings is too ________ because the mortality rate for aerial acrobats is ________ than for other types of pilots. A) low, lower B) low, higher C) high, lower D) high, higher
A positive temporary supply side shock will:
A. increase the level of potential output in the long run. B. decrease the price level in the long run. C. increase the price level in the long run. D. have no effect in the long run.