In the simple Keynesian portion of the upward sloping short-run aggregate supply curve
A) equilibrium real GDP is demand-determined.
B) equilibrium real GDP is supply-determined.
C) equilibrium real GDP is neither determined by aggregate supply nor by aggregate demand.
D) equilibrium real GDP is determined by both aggregate supply and aggregate demand.
A
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The law of demand states that
A) people demand less at lower prices. B) the quantity demanded is directly related to price. C) the quantity demanded is inversely related to price. D) changes in price and changes in quantity demanded move in the same direction.
The assumption that people act in their best self-interest means people
a. do what gives them the greatest benefits at the lowest costs. b. are selfish. c. do what gives them the smallest benefits at the greatest costs. d. are irrational.
The major tools of monetary policy available to the Federal Reserve System are
A) reserve requirements, margin regulations, and moral suasion. B) reserve requirements, open-market operations, and the discount rate. C) open-market operations, margin regulations, and moral suasion. D) the discount rate, margin regulations, and moral suasion.
The costs associated with reaching and enforcing agreements are called
A) private property costs. B) common property costs. C) transaction costs. D) public costs.