One explanation for the downward slope of the aggregate demand curve is that when the price level increase, which of the following will decrease?
A) Real value of assets
B) Price of foreign goods
C) Prices of substitute goods
D) Expectations of future prices
E) Government deficits
Answer: A) Real value of assets
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One reason the U.S. government is sensitive to demands by the elderly is that the elderly have higher voter participation rates than members of other age groups
a. True b. False
Government programs that take money from high-income people and give it to low-income people typically
a. improve economic efficiency because they reducing poverty. b. reduce economic efficiency because they distort incentives. c. have no effect on economic efficiency because they both reduce poverty and distort incentives. d. sometimes improve, sometimes reduce, and sometimes have no effect on economic efficiency.