In the long run ________
A) the amount of output an economy can produce is determined by real variables like capital, labor and technological advances
B) aggregate supply is fixed at the potential level of output
C) there is enough time for prices to fully adjust so the classical dichotomy holds
D) all of the above
E) none of the above
D
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A Nash equilibrium
i. is named after the Nobel prize winning economist, John Nash. ii. occurs when each player chooses the best strategy given the strategy of the other player. iii. must give the best possible outcome for each player. A) i only B) ii only C) iii only D) i and ii E) ii and iii
Refer to Figure 27-1. An increase in taxes would be depicted as a movement from ________, using the static AD-AS model in the figure above
A) A to B B) E to B C) B to C D) C to D E) B to A
Refer to Figure 16.1. If a firm expects that consumer preference for its product will increase in the future, this is best represented by a movement from
A) point A to point C. B) point B to point A. C) point A to point B. D) point C to point A.
By referring to Figure 7-1, an increase in the money stock
a. shifts the LM schedule to the right from LM0 to LM1. b. shifts the LM schedule to the left from LM0 to LM2. c. leaves the LM curve unchanged at LM0. d. shifts neither the IS nor the LM schedule.