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
Answer: A
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The state Department of Agriculture raised the minimum price for a gallon of milk in the city on Tuesday to $4.37
"If you've got two or three kids and you're living on a fixed income and you're paying half your income on rent," Gioia said, "then you're really in a bind and you're making choices you should never have to make." If even after this price increase Gioia's marginal utility per dollar is higher for milk than for other goods, what should Gioia do? A) increase her consumption of milk B) decrease her consumption of milk C) not change her consumption of milk D) increase her consumption of milk only if her income increases
The empirical data indicate that in the short run exchange rates are much more variable than inflation differentials
Indicate whether the statement is true or false
When a firm experiences constant returns to scale,
a. long-run average total cost is unchanged, even when output increases. b. long-run marginal cost is greater than long-run average total cost. c. long-run marginal cost is less than long-run average total cost. d. the firm is likely to experience coordination problems.
A decrease in the price of pizza will lead to a(n):
A. increase in the demand for pizza. B. increase in the quantity of pizza demanded. C. decrease in the number of consumers. D. decrease in the quantity of pizza demanded.