If the public believes that the commitment to a nominal anchor is not credible, the effect of a positive aggregate demand shock is for ________
A) short-run aggregate supply to shift down
B) short-run aggregate supply to remain unchanged
C) short-run aggregate supply to shift up
D) inflation, but not economic activity, to increase
C
Economics
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Which of the following is a situation that makes the market behave inefficiently?
a) when consumers do not have enough information to make good choices b) when the producers have the power to find out exactly what to produce c) when both consumers and producers are fully informed about a product d) when the market is in perfect competition and prices are high
Economics
What is a normal good?
a. A good whose demand increases when income decreases b. A good whose demand decreases when income decreases c. A good whose demand increases when price increases d. Both B&C
Economics