If the price level is fixed, then changes in nominal income will be equivalent to changes in real income
a. True
b. False
Indicate whether the statement is true or false
True
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Your friend notices that U.S. auto production and U.S. population growth have moved together over several decades. He reasons that one way to slow population growth is for the government to order the auto makers to cut back on production. You gently point out to him that he
a. is correct only when the economy is in a recession b. has mistakenly inferred causation from observed correlation c. has ignored secondary effects d. has committed the fallacy of composition e. is correct only when the United States enjoys economic growth
The idea that aggregate price levels do not affect real outcomes in the economy is called the:
A. aggregate price theory. B. real output theory. C. neutrality of money. D. neutrality of prices.
As new firms enter a decreasing-cost industry
A. the position of the LRAC curve doesn't change, but firms move down their LRAC curve. B. the LRAC curve shifts down. C. the LRAC curve shifts up. D. the position of the LRAC curve doesn't change, but firms move up their LRAC curve.
Refer to the table below. To increase output from 99 to 132 units requires ________ extra employee-hours; to increase output from 132 to 165 units requires ________ extra employee-hours.OutputPer DayNumber ofEmployeeHours Per Day00331662994132716511
A. 11; 18 B. 4; 3 C. 3; 4 D. 7; 11