Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the short run would be:
A. P1 and Y2.
B. P3 and Y1.
C. P2 and Y2.
D. P2 and Y3.
Answer: D
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If the price of a movie rises 3 percent and, as a result, the quantity demanded of video rentals increases 6 percent, then the cross elasticity of demand is
A) 2. B) 1/2. C) -1/2. D) -2. E) 9.
If 40 rupees = $1, then one rupee = _____________.
Fill in the blank(s) with the appropriate word(s).
Which of the following is not an advantage of a global currency?
a. International transactions would have fewer transactions costs. b. Travel would be simplified. c. A global currency would foster competition due to increased price transparency. d. All of these are advantages.
A university raises annual tuition by 2 percent. No other events have occurred, and the university's revenues have increased. It must be TRUE that
A) the associated change in quantity demanded was smaller than 2 percent. B) the associated change in quantity demanded was equal to 2 percent. C) the associated change in quantity demanded was greater than 2 percent. D) there was no associated change in quantity demanded.