According to Keynesians, an increase in the money supply will have its greatest impact on real GDP and least impact on the price level when the aggregate demand curve intersects
a. the vertical portion of the aggregate supply curve
b. the upward sloping portion of the aggregate supply curve
c. the horizontal portion of the aggregate supply curve
d. either the upward sloping or the vertical portions of the aggregate supply curve
e. either the horizontal or vertical portions of the aggregate supply curve
C
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According to your textbook, the current war on drugs in the United States has similar consequences to the earlier prohibition on alcohol. The similar consequences include
A) an underground supply and demand process. B) the production of more powerful and dangerous forms of the illegal products. C) production and distribution being controlled by people with a comparative advantage in crime D) All of the above. E) None of the above.
Fresh tuna can be canned or used to make sushi. Other things equal, if consumers start demanding more sushi?
a. The price of tuna will fall. b. Less tuna will be canned and more will be used in tuna sushi. c. The supply of fresh tuna will decrease. d. The price of tuna sushi will fall. e. None of the above.
If an economy is operating on its production possibilities frontier (PPF), are there any unemployed resources in the economy?
What will be an ideal response?
If the real interest rate in the economy is i and the expected rate of return on additional investment is r, then other things equal:
A. investment will take place until i and r are equal. B. investment will take place until r exceeds i by the greatest amount. C. r will rise as more investment is undertaken. D. i will fall as more investment is undertaken.