The aggregate supply curve will be vertical when
a. output can be increased without an increase in the price level
b. the economy is operating at full-employment capacity
c. output and price level rise together
d. the aggregate demand curve shifts to the left
e. aggregate demand is absent
B
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Suppose that a jewelry store found that when it increased prices by 10 percent, sales revenue increased by 3 percent. Which of the following is true about the price elasticity of demand for the store's goods?
A. Demand is perfectly inelastic. B. Demand is inelastic, but not perfectly. C. Demand is perfectly elastic D. Demand is elastic, but not perfectly.
The heart of the supply-side economic program was to
A. raise taxes. B. lower taxes. C. raise government spending. D. put people to work in government jobs.