The purchasing power of money increases when
A) the inflation rate increases.
B) there is inflation.
C) there is deflation.
D) there are more dollars in the economy.
C
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The reason that it is possible for the economy in the above figure to be at E2 rather than at E1 is that
A) in the long run there is always less than full employment. B) in the short run the economy can produce more than it can in a long-run full-adjustment situation. C) AD always shifts outward and never shifts inward. D) the economy must be in a recession.
A cartel's marginal cost curve is the
a. highest of all the individual firms' marginal cost curves b. lowest of all the individual firms' marginal cost curves c. horizontal sum of all the individual firms' marginal cost curves d. average of all the individual firms' marginal cost curves e. product of all the individual firms' marginal cost curves
Which of the following would generate a dollar demand for the euro?
a. American exports to Europe. b. European demand for U.S. government bonds. c. American demand for European real estate. d. All of the above are correct.
Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary B. B; no output C. B; expansionary D. A; a recessionary