Refer to Figure 24-1. Ceteris paribus, a decrease in households' expectations of their future income would be represented by a movement from
A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A.
B
You might also like to view...
When looking at data for unemployment and inflation from the 1970s there is evidence to support the short run Phillips Curve.
Answer the following statement true (T) or false (F)
Ruben earned a salary of $60,000 in 2001 and $80,000 in 2006 . The consumer price index was 177 in 2001 and 221.25 in 2006 . Ruben's 2006 salary in 2001 dollars is
a. $20,000; thus, Ruben's purchasing power increased between 2001 and 2006. b. $20,000; thus, Ruben's purchasing power decreased between 2001 and 2006. c. $64,000; thus, Ruben's purchasing power increased between 2001 and 2006. d. $64,000; thus, Ruben's purchasing power decreased between 2001 and 2006.
Keynes's liquidity preference theory of the interest rate suggests that the interest rate is determined by
A. the supply and demand for labor. B. aggregate supply and aggregate demand. C. the supply and demand for loanable funds. D. the supply and demand for money.
The United States can gain from international trade if
A. it imports goods for which it is a high-opportunity cost producer and exports those for which it is a low-opportunity cost producer. B. the dollar appreciates in value. C. the dollar is overvalued in the currency market.