Which of the following could lead to a decline in aggregate supply in the U.S.?
a. The discovery of new mineral deposits in Arizona
b. Higher real wage rates in the U.S.
c. Lower personal income in France
d. Cutbacks in government borrowing
e. Rapid depreciation of the Swiss franc
b
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If the economy is in long run equilibrium and then aggregate demand increases, in the long run the increase in aggregate demand means that the
A) price level will be higher but real GDP will be unaffected. B) real GDP will be larger but the price level will be unaffected. C) the price level will be higher and real GDP will be larger. D) neither the price level nor real GDP will be unaffected.
The level of real GDP in the long run is
A) potential GDP. B) determined solely by aggregate demand. C) affected by changes in the price level. D) the same as the level of nominal GDP in the long run.
Assume the United States can use a given amount of its resources to produce either 20 airplanes or 8 automobiles and Japan can employ the same amount of its resources to produce either 20 airplanes or 10 automobiles. The U.S. should specialize in:
a. neither good. b. automobiles. c. airplanes. d. both goods.
Differentiate between a normal (superior) and an inferior good
Please provide the best answer for the statement.