In the income-expenditure model, for each price level there is a different equilibrium output level. If we plot one such equilibrium output and price combination, we obtain
A) a point on the aggregate demand curve. B) the slope of the planned expenditures line.
C) the slope of the entire aggregate demand curve. D) the aggregate demand curve.
A
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If the incentive to take advantage of a conflict of interest is high
A) removing the economies of scope that created the conflict may induce higher costs because of the decrease in the flow of reliable information. B) then the government must step in to remove the conflict. C) the costs of non-action in removing the conflict will always be higher than the cost of removing the conflict. D) firms will always step in and work to remove the conflict.
During the past 50 years, the production possibilities of the United States have expanded, increasing both short-run and long-run aggregate supply. Other things constant, this would lead to
a. an expansion in output and an increase in prices. b. an expansion in output and a decrease in prices. c. no change in either output or prices. d. no change in output and a decrease in prices.