According to Friedman's permanent income hypothesis, a family's income can be divided into permanent income and

If the price of Pepsi increases, then there will be ________ of Pepsi.

A. a decrease in the supply B. a decrease in the quantity supplied C. an increase in the supply D. an increase in the quantity supplied

Refer to Figure 10.3. If autonomous investment spending drops by enough to shift the aggregate demand curve from AD1 to AD2, the multiplier effect is likely to

A. Create a second induced shift from AD2 to AD3. B. Create a second induced shift from AD2 back to AD1. C. Have no effect on the AD curve. D. Create a second induced shift from AD2 to AD0.