Which of the following is not a reason for the aggregate demand curve to be downward sloping?
A. Foreign purchases effect
B. Diminishing marginal utility
C. Interest rate effect
D. Real balance effect
Answer: B
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When output is below its full-employment level, the short-run aggregate supply will shift down and to the right because
A) the expected price level will be below the actual price level. B) workers' wages will decline. C) prices of nonlabor inputs will rise. D) workers' wages will rise.
Suppose the market demand curve (D) in an oligopoly market characterized by a dominant firm and a fringe is given by Q = 25 - 2P. The fringe supply curve is given by QF = -1 + 0.3P. If the marginal cost of production for the dominant is $3, calculate the market price and total output produced by the dominant firm and the fringe
a. Q = 14.42 units and P = $8.64 b. Q = 10.69 units and P = $7.15 c. Q = 12.69 units and P = $6.5 d. Q = 8.74 units and P = $5.15
Before the banking industry was deregulated, the interest rates that savings and loan institutions paid to depositors was fixed by the federal government
Indicate whether the statement is true or false
A perfectly inelastic supply curve is
A) an upward sloping straight line that intersects the origin. B) horizontal. C) vertical. D) downward sloping.