If an Engel curve has a negative slope,
A) the good is inferior.
B) the good is normal.
C) the good has no substitutes.
D) the good has no complements.
A
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Education in the United States is heavily subsidized by the government. This fact suggest that
I. less than the efficient amount of education would be provided by an unregulated market. II. the marginal social benefit of education is greater than marginal social cost of education. A) I only B) II only C) both I and II D) neither I nor II
Traditional Keynesian economists believed that:
a. the aggregate supply curve is a vertical line at a fixed level of prices. b. an increase in aggregate demand would cause a change in the price level. c. the government should take an active role in the economy to restore equilibrium. d. changes in aggregate demand does not determine equilibrium real GDP. e. the private sector is not an important source for shifts in aggregate demand.
Other things remaining constant, the only way to move along a given supply curve for a product is for:
a. Technological changes to occur b. The number of sellers to increase or decrease c. The price of resources used to produce the product to increase or decrease d. The product's price to increase or decrease
If we observe an increase in real GDP and an increase in the price level after an increase in aggregate demand, we can conclude that
A. the aggregate supply curve is vertical. B. the aggregate supply curve is upward sloping. C. the aggregate supply curve is horizontal. D. the economy is now at full employment.