An increase in AD will primarily increase output when the economy is on the flat part of the AS curve.
Answer the following statement true (T) or false (F)
True
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What is the main factor that explains why government spending typically exceeds government purchases?
a. Imports exceed exports b. Transfer payments c. The federal debt d. Government budget deficits e. Construction of schools
If the exchange rate is 2 Brazilian reals per dollar and a meal in Rio costs 20 reals, then how many dollars does it take to buy a meal in Rio?
a. 40 and your purchase will increase Brazil's net exports. b. 10 and your purchase will increase Brazil's net exports. c. 40 and your purchase will decrease Brazil's net exports. d. 10 and your purchase will decrease Brazil's net exports.
One problem with antitrust laws is that they:
A. blunt firms' incentives to cut costs. B. encourage too many mergers. C. may prevent companies from achieving economies of scale. D. are too recent to be understood by most lawyers.
The effect of a shift in the aggregate demand curve due to an increase in consumer confidence will be:
A. a decrease in prices only in the long run; output will remain the same. B. an increase in both prices and output in the short run. C. a decrease in both prices and output in the short run. D. an increase in output only in the long run; prices will remain the same.