Which of the following best explains why the aggregate expenditure curve gets higher as the price level drops?
a. Purchasing power increases.
b. The economy moves closer to equilibrium.
c. Planned investment decreases.
d. Government purchases are falling.
a. Purchasing power increases.
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According to the authors of your text, a politician's interest in getting reelected
A) expands the politician's time horizon. B) leads the politician to concentrate on policies capable of generating short-run benefits. C) further encourages the politician to conform more to acting in the public interest. D) is based chiefly on selfish interest.
Economists usually use the term "recession" to refer to: a. any slowdown in the growth of real GDP
b. zero real GDP growth. c. two or more consecutive quarters of declining real GDP. d. a reduction in nominal GDP lasting more than six months.