An investor who wants to diversify his portfolio will buy only bonds when both stocks and bonds are expected to yield better returns

Suppose the actual and expected price levels in an economy are initially equal. However, the actual price level falls eventually due to a change in economic conditions. Which of the following will occur over the long run?

a. The economy will move rightward along the short-run aggregate supply curve. b. The economy will move leftward along the short-run aggregate supply curve. c. The short-run aggregate supply curve will shift to the right. d. The short-run aggregate supply curve will shift to the left. e. The short-run aggregate supply curve will become flatter.

A nation with a trade surplus will necessarily have saving that is greater than domestic investment

a. True b. False Indicate whether the statement is true or false