Which of the following is true from the perspective of the New Keynesian school of thought?
a. Fluctuations in private spending does not affect aggregate demand in an economy.
b. Investment spending remains relatively constant irrespective of the supply shocks.
c. Fluctuations in aggregate demand are not the primary source of problem for policymakers.
d. The government should limit its role to administrative functions.
e. Monetary and fiscal policies often fail to restore macroeconomic equilibrium.
c
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Use the figure below to answer the following question.
At equilibrium, economic surplus is
A. 200. B. 350. C. 150. D. 700.
The short run Phillips Curve shows there is ________ relationship between the unemployment rate and the rate of inflation.
A. a positive B. a constant C. a negative D. no
After the imposition of the quota, the quantity demanded of TVs is ________.
A. 40,000 B. 100,000 C. 20,000 D. 80,000
Governments establish the laws that regulate the interaction between businesses and households but do not serve as actors in the economy themselves.
Answer the following statement true (T) or false (F)