The long-run effect of an increase in household consumption is to raise
a. both real output and the price level.
b. real output and lower the price level.
c. real output and leave the price level unchanged.
d. the price level and leave real output unchanged.
d
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When the percentage change in the quantity supplied is less than the percentage change in price, the supply is
A) elastic. B) inelastic. C) unit elastic. D) perfectly unit elastic. E) perfectly elastic.
Sandra's Sweaters' production function is shown in the above table. Sandra rents three knitting machines for $30 a day each and hires workers at a wage rate of $40 a day
If the rental rate of capital rises to $50 per machine a day, Sandra's ________ curve shifts upward. A) average variable cost B) total variable cost C) average fixed cost D) marginal cost
Expansionary monetary policy to prevent real GDP from falling below potential real GDP would cause the inflation rate to be ________ and real GDP to be ________
A) higher; higher B) higher; lower C) lower; lower D) lower; higher
Labor-augmenting technological change refers to improvements in efficiency that
A) occur without increasing the productivity of labor or the efficiency of capital goods. B) increase the productivity of labor and the efficiency of capital goods. C) increase the efficiency of capital goods without having to increase the productivity of labor. D) increase the productivity of labor but that do not directly make capital goods more efficient.