In the basic aggregate demand - aggregate supply model, a decrease in the price of oil will in the short run lead to _____ in the unemployment rate and ______ in the price level.
Fill in the blank(s) with the appropriate word(s).
Answer: decrease, decrease
You might also like to view...
Why is it difficult to make accurate and valid comparisons of real GDP or GNP for different countries, and how do the World Bank and the IMF deal with these difficulties?
What will be an ideal response?
When a price-taking country joins the global market for some good, it:
A. shifts the world demand and supply to the right. B. has a negligible effect on the world equilibrium. C. shifts the world demand to the right, and the world supply to the left. D. shifts the world demand and supply to the left.
Comparative advantage refers to the:
A. Total amount of resources needed to produce a good. B. Gains from trade that some countries are able to experience. C. Comparison of production processes in two different countries. D. Relative opportunity costs of producing a particular good.
According to economic analysis, the optimal level of pollution is
A) always zero. B) at the point at which the marginal benefits of pollution control exceed the marginal cost. C) at the point at which the marginal benefits of pollution control are less than the marginal cost. D) at the point at which the marginal benefits from pollution control are equal to the marginal cost.