Suppose that the short-run aggregate supply curve is: ?= 2 + 1.5 (Y-10), where ? is inflation and Y is output; and the aggregate demand curve is Y= 11 - 0.5?. The equilibrium output is ________ and the equilibrium inflation rate is ________ %
A) 10; 2
B) 17.5; 2
C) 2; 10
D) 10; 7.5
A
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Rising inflation is the pressing concern of the government of Greatland. Suggest a suitable monetary policy that the Central Bank should adopt to lower the rate of inflation
What will be an ideal response?
While the classicists believed that both velocity and output are stable, Keynesians believe:
a. velocity is stable and output is variable. b. velocity and output are both variable. c. output is stable and velocity is variable d. the same as the classical economists that both output and velocity are stable e. at low levels of income both velocity and output are stable, but at high levels of income velocity becomes variable.
In terms of the production possibilities curve, inefficiency is represented by
A. All points inside the curve. B. A rightward shift of the curve. C. All points outside the curve. D. All points on the curve.
Imports of Japanese passenger vehicles into the U.S. tend to
A. harm U.S. consumers and help Japanese automakers. B. help U.S. consumers and harm U.S. automakers. C. harm Japanese consumers and help U.S. automakers. D. help U.S. consumers and harm Japanese automakers.