Keynesians believe that the most important shocks for affecting the business cycle are
A) productivity shocks.
B) aggregate supply shocks.
C) aggregate demand shocks.
D) government spending shocks.
C
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Under a perfectly competitive price system
a. an equitable allocation of the available resources will always result. b. there is no opportunity for individuals to trade amongst themselves. c. there is no reason to expect that voluntary trading will result in an equitable allocation of the available resources. d. None of the above will result.
Which procedure seems to be most useful to structure a macroeconomic analysis?
a. (1) Analyze the chain reaction of economic causes and effects; (2) Identify the economic shock; (3) Describe the economic setting in the three key markets. b. (1) Analyze the chain reaction of economic causes and effects; (2) Describe the economic setting in the three key markets; (3) Identify the economic shock. c. (1) Identify the economic shock; (2) Analyze the chain reaction of economic causes and effects; (3) Describe the economic setting in the three key markets. d. (1) Identify the economic shock; (2) Describe the economic setting in the three key markets; (3) Analyze the chain reaction of economic causes and effects. e. (1) Describe the economic setting in the three key markets; (2) Identify the economic shock; (3) Analyze the chain reaction of economic causes and effects.
The law of demand is simply a reflection of the
a. work of Alfred Marshall who formulated the law. b. basic principle of economics: Incentives influence behavior in a predictable fashion. c. production possibilities curve. d. law of comparative advantage.
The practice of spreading one's wealth over a variety of different financial investments in order to reduce overall risk is called:
A. diversification. B. following the risk premium. C. allocation. D. risk reservation.