Economic growth will occur and the price level will be constant when the increase in aggregate demand
What will be an ideal response?
exactly equals the increase in long-run aggregate supply.
You might also like to view...
The Volcker Disinflation (1980-1986 ) was costly in terms of output and unemployment. Would it not have been better to reduce inflation with a positive supply shock, rather than a negative demand shock?
What will be an ideal response?
Which of the following will shift the Keynesian short-run aggregate supply curve downward and to the right?
A) a rise in the price level B) a fall in the price level C) a decrease in input costs D) an increase in input costs
Negative externalities cause loss of welfare not transmitted by market factors.
A. True B. False C. Uncertain
The monopolistic competitor produces a ________ output than the perfect competitor, charges a ______ price, and in the long run, earns __________ profit.
Fill in the blank(s) with the appropriate word(s).