A decrease in the price level will cause:
A. the short-run aggregate supply curve to shift to the right.
B. the aggregate demand curve to shift to the right.
C. a movement rightward along the short-run aggregate supply curve.
D. the long-run aggregate supply curve to shift to the right.
C. a movement rightward along the short-run aggregate supply curve.
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"Coffee Prices Sink As Demand Falls." The newspaper heading
A) assumes the law of demand does not hold. B) confuses demand with quantity demanded. C) misunderstands the role of supply in price formation. D) reverses the actual relationship between price and demand. E) uses the concept of demand correctly.
When compared with other governments around the world, government spending in the United States as a percentage of GDP_____
a. is generally lower than similar countries b. is generally higher than similar countries c. is about average relative to similar countries d. is impossible to compute because of differences between countries