The aggregate demand curve
a. represents the relationship between prices and quantities of all goods produced in an economy
b. is derived from equilibrium conditions in the labor and money markets
c. gives the equilibrium level of real GDP corresponding to a given price level
d. is the sum of an economy's individual demand curves
e. plots the interest rate as a function of output
C
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In 2012, the United States imposed countervailing duties ranging from 24 to 36% (on imports of about solar panels from China. Which of the following do you predict will happen if the United States decides to eliminate these duties?
a. The U.S. price of solar panels will fall. b. U.S. production of solar panels will rise. c. U.S. imports of Chinese solar panels will fall. d. The U.S. price of solar panels will rise.
Monetarists' preference for reduced-form models is based on their belief that
A) reverse causation is a problem. B) structural models may understate money's effect on economic activity. C) money supply changes are always endogenous. D) monetary policy affects only investment spending.