A theory suggesting that price stickiness leads to sluggish short-run adjustment of the price level to variations in aggregate demand is known as
A) new Keynesian flexible-price business cycles.
B) new Keynesian inflation dynamics.
C) real-business-cycle fixed-price business cycles.
D) real-business-cycle inflation dynamics.
B
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Production possibilities frontiers usually curve out and away from the origin. The implication is
A) that as resources are used to produce one good, fewer resources are available to produce another good. B) that the opportunity cost of producing a good goes down as more of that good is produced. C) technological change is present. D) that the opportunity cost of producing a good stays the same regardless of how much of that good is produced. E) some resources are better at producing one good while other resources are better at producing alternative goods.
National income accounting reveals that the value of total production in an economy
A) is always greater than the value of total income in the economy. B) is always less than the value of total income in the economy. C) is always equal to the value of total income in the economy. D) may be greater than, less than , or equal to the value of total income in the economy.