A conclusion of the theory of rational expectations is that, in the short run, the impact of a correctly anticipated fiscal policy designed to decrease AD will:
a. result in no net change in AD once people's expectations adjustments have been accounted for
b. shift AD in the opposite direction intended once people's expectations adjustments have been accounted for.
c. decrease the price level.
d. result in no change in the price level.
c
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The price elasticity of demand for labor equals
A) the percentage change in the price of labor divided by the percentage change in the supply of labor. B) the change in the quantity demanded of labor divided by the change in the price of labor. C) the slope of the demand curve for labor. D) the percentage change in the quantity demanded of labor divided by the percentage change in the price of labor.
To equalize traffic on transportation routes, a pricing arrangement called "peak, off-peak pricing" would most likely be proposed by
a. economists. b. politicians. c. regulators. d. the general public.