Refer to the above figure. If the price level is 80
A. the economy will have economic growth and the new equilibrium price level will be 80.
B. the total planned real expenditures by individuals, businesses, and the government are less than total planned production by firms.
C. the total planned real expenditures by individuals, businesses, and the government exceed total planned production by firms.
D. the aggregate demand curve will automatically shift leading to a stable equilibrium.
Answer: C
You might also like to view...
Refer to the figure above. If a per-unit tax of $3 is imposed on the sale of Good X, what is the tax revenue received by the government?
A) $20 million B) $10 million C) $12 million D) $60 million
Using the AD-AS model, an increase in government expenditure...
a) has no impact on real GDP b) has no impact on real GDP, but will increase potential GDP c) increases both real and the price level d) has a full multiplier effect on real GDP, leaving the price level unchanged in the long run
An elasticity of 1.5 means that a 1% change in price will lead to a ____% change in quantity demanded.
A. 0.5 B. 1.0 C. 1.5 D. 3.0
A large open economy's real interest rate will decrease if
A. the expected future marginal product of domestic capital rises. B. there is a temporary positive domestic supply shock. C. the expected future marginal product of foreign capital rises. D. there is a temporary negative domestic supply shock.