According to adaptive expectations theory, expansionary monetary and fiscal policies to reduce the unemployment rate are:
A. useless in the long run.
B. useless in the short run.
C. ineffective on the price level.
D. successful at achieving the desired outcomes.
Answer: A
Economics
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If the price in the market for a commodity is below the equilibrium price, the:
A) price will remain unchanged. B) price will decline to clear the market. C) quantity supplied exceeds the quantity demanded. D) quantity demanded exceeds the quantity supplied.
Economics
Suppose that the level of GDP increased by $100 billion in a private closed economy where the marginal propensity to consume is .5. Aggregate expenditures must have increased by:
A. $100 billion. B. $50 billion. C. $500 billion. D. $5 billion.
Economics