The table above gives the aggregate demand and aggregate supply schedules in Lotus Land. Lotus Land is in short-run macroeconomic equilibrium
In the long run, if aggregate demand does not change, then Lotus Land will return to full employment as ________. A) the money wage rate rises
B) the money wage rate falls
C) businesses cut their imports
D) the government cuts taxes
B
You might also like to view...
The above table has the demand and supply schedules for money. Real GDP increases and, as a result, the demand for money increases by $0.1 trillion at each level of the nominal interest rate. The new equilibrium interest rate is
A) 5 percent. B) 2 percent. C) 10 percent. D) 3 percent. E) 7 percent.
According to the theory of creative destruction, the greatest threat to a monopolist producer of electric typewriters is likely to be
a. government regulation b. international competition c. the entry of new electric typewriter producers d. growth in the computer industry e. stockholders demanding increased efficiency