An increase in the price level will increase the interest rate, which will decrease investment spending and shift aggregate demand to the left
a. True
b. False
B
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Bobby drives her car to work; Bill takes the bus. They are both behaving efficiently as long as we assume
A) it costs the same for Bobby to drive the car as it does for Bill to take the bus. B) both Bobby and Bill value their trips equally. C) Bobby and Bill are traveling to different locations. D) both Bobby and Bill voluntarily selected the forms of transportation they take to work.
Happy Bagels sells its bagels for $6 each and the firm has a constant marginal cost of $4 per bagel, which is equal to its (constant) average total cost. If Happy Bagels does not sell a bagel the day it is produced, the bagel is sold as day-old for $2. If Happy Bagels is currently holding 50 bagels in inventory and the probability that Happy Bagels will sell 50 bagels or more is 0.40, which of
the following statements is true? A) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to double its inventory. B) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to increase its inventory. C) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to decrease its inventory. D) Happy Bagels is holding the profit-maximizing, optimal level of inventory.
When PAE decreases then the economy will move towards:
A. lower levels of equilibrium GDP. B. higher levels of equilibrium GDP. C. constant levels of GDP. D. higher levels of equilibrium aggregate expenditure.
Macroeconomic equilibrium occurs when:
a. Expected amount supplied equals expected amount demanded, which means expected leakages equal expected injections. b. Leakages equal injections. c. Supply equals demand and Leakages equal injections. d. Expected and actual supply equals expected and actual demand, which means expected and actual leakages equal expected and actual injections. e. None of the above.