If the short-run aggregate supply increases by less than the long-run aggregate supply, then, at the short-run equilibrium
A) GDP will be below potential GDP. B) aggregate demand will increase.
C) GDP will be equal to potential GDP. D) GDP will be above potential GDP.
A
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Monopolistically competitive firms can achieve product differentiation through:
A. creating a truly different product. B. creating the perception of differences in their product. C. creating a product that cannot be easily substituted with a rival's product. D. All of these statements are true.
Fill in the blanks. Which of the following has been found by researchers in surveys of consumers? Most people consider it _________ for firms to raise their prices following an increase in costs ____________ to raise prices following an increase in demand.
a. fair; and fair b. fair; but unfair c. unfair; but fair d. unfair; and unfair
Assume the economy's consumption and saving schedules simultaneously shift downward. This must be the result of:
A. an increase in disposable income. B. an increase in household wealth. C. an increase in personal taxes. D. the expectation of a recession.
The stock of wealth increases more rapidly the faster the flow of ________.
A. saving B. money C. income D. assets