According to the Phillips curve, policymakers can reduce inflation by
a. contracting aggregate demand. This contraction results in a temporarily higher unemployment rate.
b. contracting aggregate demand. This contraction results in a temporarily lower unemployment rate.
c. expanding aggregate demand. This expansion results in a temporarily lower unemployment rate.
d. expanding aggregate demand. This expansion results in a temporarily higher unemployment rate.
a
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What best determines the price a price taker will charge?
A) Demand B) Revenue C) Cost D) Reputation
Which of the following statements is true of the relationship among the average cost functions?
A) ATC = AFC - AVC B) AVC = AFC + ATC C) AFC = ATC + AVC D) AFC = ATC - AVC
The circular flow model shows what households buy and sell in the resource market
Indicate whether the statement is true or false
Keynes used the term "animal spirits" to refer to
a. policy makers harming the economy in the pursuit of self interest. b. arbitrary changes in attitudes of household and firms. c. mean-spirited economists who believed in the classical dichotomy. d. firms' relentless efforts to maximize profits.