All of the following are assumptions made by the dynamic model of aggregate demand and aggregate supply except
A) the short-run aggregate supply curve shifts to the right except during periods when workers and firms expect higher wages.
B) aggregate demand and potential real GDP decrease continuously.
C) potential real GDP increases continuously.
D) the aggregate demand curve shifts to the right during most periods.
B
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The concept of "the invisible hand" suggests that
A) products are produced out of a seller's sense of charity. B) when the seller is better off, the buyer is worse off. C) sellers exploit consumers with high prices. D) buyers and sellers are self-interested. E) the command system is the only way of efficiently allocating resources.
In the early antebellum period, New England women's wages were about 1/3 of men's wages. By 1860, New England women's wages were
a. about ¼ of men's wages. b. about ½ of men's wages. c. more than men's wages. d. about equal to men's wages.
Starting from an initial long-run equilibrium, under the adaptive expectations hypothesis, a shift to a more expansionary policy will increase
a. prices and unemployment in the long run. b. real output in the short run but not in the long run. c. real output in the long run but not in the short run. d. real output in both the long run and the short run.
Half of long-term external debt of developing countries is
A. sovereign debt. B. debt overhang. C. private debt owed by individual citizens. D. rescheduled debt.