A policy to increase aggregate demand to cure a recessionary gap may succeed; however, inflation is a likely result

Under a price cap regulation, the regulated industry has an incentive to

A) operate efficiently and not inflate its costs. B) inflate costs. C) decrease its output. D) None of the above answers is correct.

A change in price that is accompanied by a change in income sufficient to leave a consumer's well-being unchanged is called:

A. an uncompensated price change. B. a compensated price change. C. an income adjusted price change. D. the income effect.