In practice, one of the principal problems with aggregate demand management is that
A. changes in aggregate demand cannot reduce unemployment.
B. stabilization policies could increase aggregate demand too much and at the wrong times.
C. changes in aggregate demand are highly inflationary.
D. changes in aggregate demand do not affect output.
Answer: B
You might also like to view...
An open outcry auction is an auction where ________
A) bids are placed privately B) public goods are sold C) bidders know about each other's bids D) free goods are distributed among the general public
When a perfectly competitive firm is in long-run equilibrium, what is the relationship between the firm's marginal cost, average total cost, marginal revenue, and price?
What will be an ideal response?
When comparing the composition of world trade in the early 20th century to the early 21st century, we find major compositional changes. These include a relative decline in trade in agricultural and primary-products (including raw materials)
How would you explain this in terms of broad historical developments during this period?
Imagine an economy that produces capital goods and consumption goods. What will happen to its production possibilities curve if some of its existing capital stock wears out and is not replaced? How will your answer differ if more than enough capital is produced to replace the capital that wears out?