The horizontal short-run aggregate supply curve
A) assumes that wages and all other input prices are constant.
B) assumes that opportunity cost is constant.
C) shows that real GDP can be increased only when prices increase.
D) assumes that there is full employment in the economy.
A
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If the price of rocket fuel imported from Russia and used by NASA suddenly increases, then the U.S. CPI will ________ and the U.S. GDP deflator will ________
A) increase; not change B) increase; increase by more than the CPI C) not change; increase D) increase; increase E) not change; not change
In the Baumol-Tobin model, given that total costs for an individual equals + , where T0 = monthly income, b = brokerage costs, and C = amount raised from each bond transaction, derive the so-called square root rule
What will be an ideal response?