Keynes argued that aggregate demand is
a. stable, because the economy tends to return to its long-run equilibrium quickly after any disturbance to aggregate demand.
b. stable, because changes in consumption are mostly offset by changes in investment and vice versa.
c. unstable, because waves of pessimism and optimism create fluctuations in aggregate demand.
d. unstable, because of long and variable policy lags that worsen economic fluctuations.
c
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All of the following are evidence of specialization except
a. a solo carpenter who builds a whole bedroom set b. restaurants that range from subs to sushi c. the credits at the end of a movie d. professional mourners in Taiwan e. online sellers
Entry of new firms will occur in a monopolistic competitive industry until:
a. marginal cost equals zero. b. marginal revenue equals zero. c. marginal revenue equals marginal cost. d. economic profit equals zero. e. economic profit is negative.
Given a production possibilities curve, a point:
a. inside the curve represents unemployment. b. on the curve represents full employment. c. outside the curve is currently unattainable. d. all of these.
The individual who brings together economic resources and assumes the risk in a capitalist economy is called the:
A. stockbroker. B. banker. C. manager. D. entrepreneur.