Suppose that the economy is at long-run equilibrium. If there is a sharp decline in the stock market combined with a significant increase in immigration of skilled workers, then in the short run
a) the price level will fall, and real GDP will fall.
b) real GDP will fall and the price level might rise, fall, or stay the same.
c) real GDP will rise and the price level might rise, fall, or stay the same.
d) the price level will fall, and real GDP might rise, fall, or stay the same.
e) the price level will rise, and real GDP might rise, fall, or stay the same.
Ans: d) the price level will fall, and real GDP might rise, fall, or stay the same.
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The practice of charging different prices to various groups of customers that are not based on differences in the costs of production is referred to as:
A) predatory pricing. B) markup pricing. C) discretionary pricing. D) price discrimination.
Which of the following will increase the break-even quantity?
a. A decrease in overall fixed costs b. A decrease in the marginal costs c. A decrease in the price level d. An increase in price level