A positive temporary supply side shock will:
A. increase the price level in the long run.
B. decrease the price level in the long run.
C. increase the level of potential output in the long run.
D. have no effect in the long run.
D. have no effect in the long run.
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In the above figure, Mark's monthly budget line for movies and plays changed, as shown by the arrow. Responding to this change, Mark probably will see
A) fewer movies and fewer plays. B) fewer movies and more plays. C) more movies and fewer plays. D) more movies and more plays.
The income effect of a price change refers to the change in the quantity demanded of a good that results from a change in purchasing power as a result of the price change
Indicate whether the statement is true or false
The velocity of M2 is equal to
A) M3 minus M1. B) GDP divided by M2. C) GDP multiplied by M2. D) the velocity of M1.
Refer to Figure 14.1. Other things equal, a decrease in government spending on infrastructure projects is best represented as a movement from
A) point A to point B. B) point C to point A. C) point C to point B. D) point B to point C.