Wage contracts force businesses to adjust wages rather than employment in response to an unexpected change in aggregate demand
a. True
b. False
Indicate whether the statement is true or false
False
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Aggregate demand shifts left if
a. government purchases increase and shifts left if stock prices rise. b. government purchases increase and shifts left if stock prices fall. c. government purchases decrease and shifts left if stock prices rise. d. government purchases decrease and shifts left is stock prices fall.
Suppose the economy experiences a recessionary gap. Expansionary monetary policy will
A) increase interest rates and increase the bond prices. B) increase interest rates and decrease the bond prices C) decrease interest rates and increase the bond prices D) decrease interest rates and decrease the bond prices
Calculate cumulative losses or gains if you buy (long) 4corn futures contracts @ $5.96/bushel one day and settlement prices will be at $5.50/bushel corn on the later day you evaluate your position. Initial and maintenance margins for corn are $2,700 and $2,000 per contract. Compute gains or losses and then compare your computed number to the following possible answers.
A. A loss of $9,200. B. A gain of $9,200. C. A gain of $10,800. D. A loss of $10,800.
Use the aggregate expenditures model and the following values to answer the next question. AMPCIGT$7500.5$1,000$1,000$500Determine equilibrium real GDP for this economy.
A. $5,000 B. $5,500 C. $4,000 D. $4,500