If an unanticipated decrease in aggregate demand results in an output below the economy's long-run capacity, long-run equilibrium will eventually be restored by
What will be an ideal response?
lower resource prices and lower real interest rates
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According to the law of diminishing marginal returns, as more of a variable input is combined with fixed amounts of other resources:
a. the additions to output will eventually decrease. b. the additions to output cannot increase. c. total output will eventually decrease. d. the additions to output will eventually turn negative.
An increase in interest rates by the Federal Reserve is an example of ________ policy.
A. structural B. aggregation C. fiscal D. monetary
The change in the consumption of one good that just offsets a one-unit change in the consumption of another good is the
A. marginal rate of satisfaction. B. marginal rate of consumption. C. marginal rate of substitution. D. marginal utility.
If disposable personal income is $500 billion and personal saving is $15 billion, the personal saving rate is
A. 1.5%. B. 3%. C. 7.5%. D. 15%.