The amount of real domestic output that will be purchased at each possible price level is best shown by the:
A. aggregate demand curve.
B. aggregate expenditures model.
C. aggregate supply curve.
D. difference between real and nominal GDP.
Answer: A
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According to this Application, a common belief is that fiscal multipliers are ________ during ________
A) larger; recessions B) of equal size; recessions and growth periods C) smaller; growth periods D) smaller; recessions
If the percentage change in the quantity demanded of a good is greater than the percentage change in price, price elasticity of demand is:
A. elastic. B. inelastic. C. perfectly inelastic. D. perfectly elastic.
When differences between nominal GDP and real GDP result due to price changes and nothing else is compared, an index is created called the:
A. inflation index. B. consumer price index. C. GDP deflator. D. index of leading indicators.
Based on the above figure, if countries "A" and "B" faced the production possibilities curves above, both countries would benefit if
A. they both produced both industrial and agricultural goods. B. they did not trade. C. "B" produced industrial goods, and "A" produced agricultural goods. D. "A" produced industrial goods, and "B" produced agricultural goods.