If the price level doubles, it will
A) increase potential GDP.
B) increase the quantity of money.
C) decrease the buying power of money.
D) decrease potential GDP.
E) have no effect on the buying power of money.
C
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Although the efficient quantity to produce of any good is located where marginal social benefit and marginal social cost are equal, there will usually be other quantities where the sum of consumer and producer surplus are greater
Indicate whether the statement is true or false
Explain how the price system eliminates a shortage
What will be an ideal response?
Sharon wants a career as an accountant. During the summer she turns down a job painting houses at $6 an hour to work in an accounting office for $4 an hour. Which of the following would not explain her choice?
a. Accounting is more prestigious. b. The summer accounting job will help her get a full-time job in accounting when she graduates. c. She prefers to work inside. d. She would face the law of diminishing marginal utility if she had more goods. e. She dislikes the messiness of painting.
Which of the following causes the production possibilities curve to shift to the right?
a. d and e. b. c and e. c. A war. d. The development of a new technology that improves productivity. e. The discovery of oil reserves.