If the price of inputs rises and consumer expectations about future economic activity worsens:
a. Aggregate demand falls, and aggregate supply rises.
b. Aggregate demand and aggregate supply fall.
c. Aggregate demand and aggregate supply rise.
d. Aggregate demand rises, but aggregate supply does not change.
e. Neither aggregate demand nor aggregate supply change.
.B
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The circular flow diagram implies that if accounting is done correctly, ________
A) the flow of income must exceed the implied value of the factors of production B) the implied value of the factors of production must exceed the flow of income C) the flow of expenditure must equal the income of the households making those expenditures D) the flow of expenditure must exceed the income of the households making those expenditures
If unemployment is above the unemployment rate consistent with full employment, then potential GDP is:
A. equal to actual GDP. B. greater than actual GDP. C. equal to the GDP gap. D. less than actual GDP.
Suppose the absolute value of the price elasticity of demand for meals at Fortune Buffet House is ?. What happens to sales revenue if the restaurant increases its price by 5 percent?
A) Sales revenue falls by less than 5 percent. B) Sales revenue remains unchanged. C) Sales revenue falls by 100 percent. D) It cannot be determined without information on prices.
Inflation initiated by increases in wages or other resource prices is labelled:
What will be an ideal response?