A positive temporary supply side shock will:
A. increase the level of potential output in the long run.
B. decrease the price level in the long run.
C. increase the price level in the long run.
D. have no effect in the long run.
Answer: D
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An increase in aggregate demand results in a(n) ________ in the ________
A) recession; long run B) expansion; long run C) recession; short run D) expansion; short run
The development of new financial securities or investment strategies using sophisticated models is known as
A) underwriting. B) factoring. C) financial engineering. D) hedging.
Which of the following is good evidence against the classical view of Say's law?
A) Investment does not always rise as interest rates fall. B) Consumption falls by the amount that saving increases. C) Exports are usually greater than imports. D) People save more at higher interest rates than lower interest rates. E) none of the above
When an economist says that the demand for a product has increased, this means that:
A. the product has become particularly scarce for some reason. B. product price has fallen and as a consequence consumers are buying a larger quantity of the product. C. the demand curve has shifted to the left. D. consumers are now willing to purchase more of this product at each possible price.