Which of the following will occur when an economy is faced with a liquidity trap situation?
A) A reduction in the price level will cause a rightward shift in the aggregate demand curve.
B) A reduction in the price level will cause a leftward shift in the aggregate demand curve.
C) The aggregate demand curve is now vertical.
D) The aggregate demand curve is now upward sloping.
C
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Suppose that we find that student grades and time spent at parties move in opposite directions. A graph of the relationship between these two variables would curve
A) upward and be linear. B) upward and may be linear or nonlinear. C) downward and be linear. D) downward and may be linear or nonlinear.
What is one reason drunk driving is held in such disrepute?
A) Drunk driving imposes high potential costs on non-drunk drivers. B) Drunk driving destroys cars and telephone poles, causing disruption in essential services. C) Only drunk drivers cause automobile fatalities. D) Drunk drivers impose high potential costs on other drunk drivers.