Imagine that in 2015 the economy is in long-run equilibrium. Then stock prices rise more than expected and stay high for some time. Refer to Stock Market Boom 2015. Which curve shifts and in which direction?
a. aggregate demand shifts right
b. aggregate supply shifts left.
c. aggregate supply shifts right
d. aggregate demand shifts left
Answer: a. aggregate demand shifts right
You might also like to view...
For the United States, what is money based on the transactions approach to measuring money?
What will be an ideal response?
The GDP deflator is:
A. a measure of the overall change in prices in an economy, using the ratio between real and nominal GDP. B. one way of summarizing how prices have changed across the entire economy. C. a weighted average of all of the individual price changes in the economy. D. All of these statements are correct.
An industry in which there are just a few large firms is likely to be characterized by
A. monopoly. B. oligopoly. C. perfect competition. D. monopolistic competition.
Foreign direct investment is:
A. investment that occurs when a firm runs its operation domestically, and sells its product abroad. B. when foreign companies buy and operate physical capital within the United States. C. when foreign companies buy physical capital from the United States. D. investment that occurs when a firm runs part of its operation abroad or invests in another company abroad.