The new classical model has as its central idea that
A) wage and price stickiness explain fluctuations in real GDP.
B) workers and firms have rational expectations.
C) the Federal Reserve should adopt a monetary growth rule.
D) shifts in aggregate demand have no impact on real GDP.
Answer: B
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The process by which monopoly profits lead to technological progress in known as
A) economies of scale. B) destructive creation. C) imperfect competition. D) creative destruction.
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.
Market supply schedule
What will be an ideal response?
Marginal revenue is equal to:
A. the change in total revenue from selling one more unit of a good. B. the number of units sold times the price of the good. C. the change in average revenue from selling one more unit of a good. D. All of these.