Recessionary gaps are associated with output below potential and high unemployment rates.
Answer the following statement true (T) or false (F)
True
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Use the following figure to answer the next question.
Suppose the economy is currently at full employment with aggregate demand curve AD2. A further increase in consumption and investment spending will cause ________.
A. demand-pull inflation, and the new equilibrium output will be more than Q2 B. cost-push inflation, and the new equilibrium output will be less than Q2 C. demand-pull inflation, and the new equilibrium output will be less than Q2 D. cost-push inflation, and the new equilibrium output will be more than Q2
Discuss the relationship between U.S. competitiveness relative to other countries and standards of living in the United States
What will be an ideal response?
Aggregate behavior is
A. the behavior of all households and firms together. B. the behavior of each individual. C. the behavior of each household and firm. D. none of the above.
Refer to the information provided in Figure 20.2 below to answer the question(s) that follow.
Figure 20.2Refer to Figure 20.2. The theory of comparative advantage suggests that
A. the United States should export both trucks and cars. B. England should import trucks and export cars. C. England should export both trucks and cars. D. the United States should export cars and import trucks.