The aggregate demand curve is the relationship between the...
A) price level and the real domestic output purchased
When the price level rises,
The demand for money and interest rates rises
The aggregate supply curve is the relationship between the...
B) price level and the real domestic output produced
If the prices of imported resources increase, then this event would most likely...
C) decrease aggregate supply
If Congress passed much stricter laws to control the air pollution from businesses, this action would tend to...
C) increase per-unit production costs and shift the aggregate supplycurve to the left
An increase in business taxes will tend to...
B) decrease aggregate supply but not change aggregate demand
In the aggregate demand-aggregate supply model, an increase in the price level will...
decrease the strength of the multiplier
Aggregate demand decreases and real output falls, but the price level remains the same. Which factor most likely contributes to downward price inflexibility?
Efficiency wages
Fear of price wars, menu costs, and wage contracts are associated with...
a price level that is inflexible downward
If there were cost-push inflation,
C) the real domestic output would decrease and the price level would rise
An increase in aggregate supply will...
C) decrease the price level and increase the real domestic output
The equilibrium price level and quantity of real domestic output will be...
100 and $3,000
If the quantity of real domestic output demanded increased by $2,000 at each price level, the new equilibrium price level and quantity of real domestic output would be...
150 and $4,000
Using the original data from the table, if the quantity of real domestic output demanded increased by $1,500 and the quantity of real domestic output supplied increased by $500 at each price level, the new equilibrium price level and quantity of real domestic output would be...
