Economic theory suggests that the standard of living of American workers would fall if the
a. United States had more natural resources.
b. knowledge and skills of workers improved, reducing the need for workers.
c. productivity of American workers declined.
d. United States turned to more automated methods of production.
c. productivity of American workers declined.
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All else equal, what happens to consumer surplus if the price of a good decreases?
a. Consumer surplus increases. b. Consumer surplus decreases. c. Consumer surplus is unchanged. d. Consumer surplus may increase, decrease, or remain unchanged.
A change in aggregate supply would be caused by a change in:
a. The price level b. An aggregate supply determinant c. The quantity of real output supplied d. Aggregate demand
When the Fed tightens U.S. monetary policy, domestic interest rates ________, making U.S. assets relatively more attractive to foreign investors, and ________ the equilibrium exchange rate.
A. fall; increasing B. fall; decreasing C. rise; increasing D. rise; decreasing
Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher