Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary
B. B; no output
C. B; expansionary
D. A; a recessionary
Answer: A
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Epsilon is a country whose unit of currency is the omega. New information leads people to expect that the omega will appreciate next year
To keep the foreign exchange value of the omega fairly steady, the Bank of Epsilon will ________ enough omegas on the foreign exchange market so that the ________ omegas will ________. A) buy; demand for; increase B) sell; supply of; increase C) buy; demand for; decrease D) buy; supply of; decrease
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.
The opportunity cost of owner-provided labor is the
A) wage rate paid to the owner. B) explicit part of the wage rate paid to the owner. C) salary the owner could have made if she worked at her best alternative job. D) profit after all of the bills have been paid.
Will the use of the euro help increase economic growth in countries in the European Union? Will it help individual countries using the euro in times of recession? Explain
What will be an ideal response?