The increase in spending that occurs because the demand for investment goods increases when the price level falls is known as the
A) price effect. B) international trade effect.
C) wealth effect. D) interest rate effect.
D
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
The more willing monetary policymakers are to raise interest rates when faced with inflation, the ________ the AD curve is, and the ________ responsive equilibrium output is to the inflation rate
A) steeper; more B) steeper; less C) flatter; more D) flatter; less
Here's a taste of economic history: in the United States, rent controls were implemented in 450 designated areas during World War II because
a. residential construction had been curtailed due to the war effort b. houses were regarded as being essential to the war effort c. there was an excess supply of housing d. quantity demanded of housing decreased as soldiers went to war e. the price of housing became depressed due to falling demand for houses
An economic boom experienced during a certain year in a country that increases actual GDP beyond potential GDP will result in: a. unemployment
b. inflation. c. deflation. d. increased fiscal spending.