In the graph shown, a shift in the AD curve to the right:
A. causes goods inflation.
B. lowers globally constrained potential output.
C. raises domestic consumption.
D. lowers domestic consumption.
Answer: C
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The upward-sloping short run aggregate supply curve shows the ___________ relationship between the price level and the level of real GDP in the short run.
a. positive b. negative c. neutral d. bi-modal
Very few people in Kyle’s country have more than a sixth-grade education. In contrast, 80 percent of the people in Carmen’s country have at least a high school diploma. Based on this information, which statement about these two countries is most likely true?
a. Carmen’s country has limited physical capital. b. Carmen’s country has a higher rate of economic growth than Kyle’s country. c. Kyle’s country has a higher birthrate than Carmen’s country. d. Carmen’s country has higher per capita output than Kyle’s country.
When the velocity of circulation equals 4 in 2010, this fact means that
A) consumers held four dollars in wealth for each dollar they spent in 2010. B) on average, each dollar of money in the economy purchased four dollars of goods and services in GDP in 2010. C) for each additional dollar of money injected into the economy, the price level rose 4 percent in 2010. D) real output of goods and services in GDP rose by four dollars for each additional dollar of money consumers saved.
In 2003, China's control of the value of the yuan became an economic and political issue for the U.S. because:
A) increased U.S. exports to China. B) decreased U.S. exports to China. C) increased China imports from the U.S. D) none of the above.