According to the aggregate expenditure model, when faced with unwanted inventory, firms
A) do nothing and wait for equilibrium to be restored.
B) are forced to go out of business.
C) immediately cut prices.
D) decrease production.
E) increase production.
D
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What is a situation in which two or more actors have a common interest but cannot automatically collaborate to achieve it?
a. a collective action problem b. a relative gains problem c. a transnational problem d. a sustainability problem
Which of the following would unambiguously generate inflation?
A) a decrease in aggregate demand accompanied by an increase in aggregate supply B) an increase in aggregate demand accompanied by a decrease in aggregate supply C) an increase in aggregate demand accompanied by an increase in aggregate supply D) a decrease in aggregate demand accompanied by a decrease in aggregate supply