The lag before the full effects of monetary policy on inflation are felt is longer than the lag before its effects on real output and unemployment are felt

A firm is currently operating where the MC of the last unit produced = $84, and the MR of this unit = $70 . What would you advise this firm to do?

a. Shut down. b. Increase output. c. Stay at its current output. d. Decrease output. e. Decrease price.

When the government closes an expansionary gap with a change in government spending, the _____ in government spending leads to _____

a. decrease; a decrease in both real GDP and the price level b. decrease; a decrease in real GDP and an increase in the price level c. decrease; an increase in both real GDP and the price level d. decrease; an increase in real GDP and a decrease in the price level e. increase; a decrease in both real GDP and the price level