According to Keynesians, the primary source of business cycle fluctuations is
A) aggregate demand shocks.
B) productivity shocks.
C) oil price shocks.
D) consumer confidence shocks.
A
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Which of the following is likely to happen when the Fed raises the federal funds rate?
A) The long-run interest rate will fall. B) The labor demand curve shifts to the left. C) The volume of economic activity will increase. D) The labor demand curve shifts to the right.
The aggregate demand for home input can be written as a function of: I. Real exchange rate. II. Government spending. III. Disposable income
A) I only B) III only C) I and III D) II and III E) I, II, and III
Unlike AFDC, TANF is an entitlement program
Indicate whether the statement is true or false
Which of the following statements concerning income and substitution effects is not true?
a. Income and substitution effects cause the demand curve to slope downward. b. When the price of a good falls, real purchasing power increases and consumers can purchase more of all goods. c. The substitution effect describes the situation in which more of the good whose price has fallen is purchased, and less of all other goods is purchased. d. A price decrease of one good cannot cause the income effect. e. Income and substitution effects are related to diminishing marginal utility and consumer equilibrium.