What will be the result in a growing economy if increases in aggregate demand outpace rightward shifts of the long-run aggregate supply curve?
A. inflation accompanied by increases in real GDP
B. secular deflation
C. a decline in consumption spending
D. inflation accompanied by declines in real GDP
Answer: A
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Flexible exchange rates ________ of monetary policy to stabilize the economy and fixed exchange rates ________ of monetary policy to stabilize the economy.
A. offset the impact; reinforce the impact B. strengthen the ability; prevent the use C. prevent the use; strengthen the ability D. strengthen the impact; strengthen the impact
A natural monopoly arises when
A) one firm controls the supply of a unique resource. B) a firm has many small firms that it can control. C) there are firms which act together as a monopoly. D) the long-run average cost curve slopes downward as it crosses the demand curve. E) one firm naturally convinces the government to limit competition in the market.
In the above figure, at the price level of 140 and real GDP of
A) $15 trillion, firms will not be able to sell all their output. B) $5 trillion, firms will not be able to sell all their output. C) $5 trillion, consumers will not be able to buy all the goods and services they demand. D) $15 trillion, consumers will not be able to buy all the goods and services they demand.
The rule of reason was an antitrust law guideline that emphasized the importance of ________ over ________
a. price; quantity b. quantity; price c. law; the economy d. size; behavior e. behavior; size