If aggregate demand shifts rightward more than expected...
What will be an ideal response?
real GDP will be greater than potential GDP
You might also like to view...
Which of the following examples identifies the income effect of a price change?
A) When Gary's income doubles his wine consumption doubles, the price of wine remaining unchanged. B) When the price of diesel falls, consumers start purchasing more petroleum-powered vehicles. C) While purchasing shirts and jeans, when the price of a pair of jeans falls, Jack purchases more of both jeans and shirts. D) While purchasing pens and pencils, when the price of pens falls, Jill purchases more pens and fewer pencils.
The difference between an interest rate and some other, benchmark interest rate is known as the
a. spread. b. rate difference c. rate of return differential. d. rent. e. income differential.
Use the graph to answer the following question:
Suppose the loanable funds market is initially in equilibrium at point A, but then implementation of fiscal policy causes crowding out to occur. After the implementation occurs, the equilibrium in the market would be best represented by
A. point A. B. point B. C. point C. D. point D.
The willingness and ability to work specific amounts of time at alternative wage rates is known as
A. Labor demand. B. Derived supply. C. Labor supply. D. Derived demand.