According to the classical dichotomy, when the money supply doubles, which of the following also doubles?
a. the price level and nominal wages
b. the price level, but not the nominal wage
c. the nominal wage, but not the price level
d. neither the nominal wage nor the price level
a
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Government expenditures are considered autonomous in the model meaning that changes are the result of:
A) changes in real income. B) changes in inflation. C) changes in unemployment. D) changes in policy decisions.
In the Keynesian zone of the short-run aggregate supply, what happens when aggregate demand increases?
a. There is increasing unemployment pressure. b. There is inflationary pressure. c There is no inflationary pressure. d. There is a lack of growth.
Which of the following is correct?
a. Over the business cycle investment fluctuates more than consumption. b. Economic fluctuations are easy to predict. c. During recessions employment rises. d. Because of government policy the U.S. had zero recessions in the last 25 years.
The organization of petroleum exporting countries (OPEC) is an example of a(n)
A) oil monopoly B) cartel C) competitive arrangement D) prisoner's dilemma