Assume the economy is at point D. What would happen to AE2 and the point of equilibrium if P increased to 110 while the autonomous parts of consumption, investment, government purchases, and net exports remained constant?
a. AE2 would shift up, and the point of equilibrium would move right.
b. AE2 would shift down, and the point of equilibrium would move left.
c. AE2 would not move, but the point of equilibrium would move left.
d. AE2 would not move, but the point of equilibrium would move right.
b. AE2 would shift down, and the point of equilibrium would move left.
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I) The growth rate of Eduland's money supply in a particular year was 8.5%
What was the growth rate of real GDP if the inflation rate in the same year was 4%? ii) What is likely to happen if the growth rate of money supply doubles in the following year, while the growth rate of real output remains unchanged?
One characteristic of monopolistic competition is that it has
A) many firms producing a slightly differentiated product. B) many firms producing identical goods. C) one firm producing a unique good. D) a few firms producing a slightly differentiated product. E) large barriers to entry.
The theory that explains the shift of color TV sets production from the United States to Japan and Taiwan is called the _____ theory
a. productivity difference b. factor abundance c. product life cycle d. preference e. human skills
The reason that most of the coffee that is consumed in the United States comes from Colombia is that
A. Colombia has an absolute advantage in producing coffee relative to the United States. B. Colombia has a comparative advantage in producing coffee relative to the United States. C. government trade disincentives regarding Colombian coffee make such trade possible. D. coffee cannot be grown in the United States.