A permanent reduction in international trade barriers would
A. decrease aggregate demand.
B. increase aggregate demand.
C. increase long-run aggregate supply.
D. decrease long-run aggregate supply.
Answer: C
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The sum of the marginal propensity to consume and the marginal propensity to save is always equal to
A) zero. B) 0.5. C) 1. D) 100.
Suppose that the market for steel is shown in the above figure. Is social welfare greater under monopoly or under competition?
What will be an ideal response?
If full employment GDP is $1 trillion greater than equilibrium GDP, and there is a recessionary gap of $400 billion, the multiplier is
A. 1. B. 2.5. C. 4. D. 5.
Theories should be judged based upon how
A) well they explain things. B) consistently and accurately they predict. C) famous the economist is making the prediction. D) the amount of attention given to them by the media. E) a and b