Refer to the information provided in Figure 27.3 below to answer the question(s) that follow.
Figure 27.3Refer to Figure 27.3. Assume the economy is currently at Point A on aggregate supply curve AS1. An increase in inflationary expectations that causes firms to increase their prices
A. moves the economy to Point B on aggregate supply curve AS1.
B. moves the economy to Point C on aggregate supply curve AS1.
C. shifts the aggregate supply curve to AS0.
D. shifts the aggregate supply curve to AS2.
Answer: D
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The belief that the ethically proper thing to do in any situation is the thing that maximizes society's overall happiness and minimizes society's overall suffering is called
A) utilitarianism. B) diminishing marginal utility. C) the benefits-received principle. D) transcendentalism.
The decline in net worth that can result from an unanticipated decline in the price level is known as ________
A) a credit boom B) deleveraging C) a debt deflation D) federal funds rationing
Use the following graph to answer the next question.
The year 2000 must be the ________.
A. year when depreciation or capital consumption equaled zero B. year when GDP equaled 100 C. base year of the GDP price index D. year when the GDP price index is zero
The price system has
A) prices fixed by the government. B) prices fixed by the seller. C) voluntary exchange. D) prices fixed by the producer.