An increase in aggregate demand in the economy will have what effect on macroeconomic equilibrium in the long run?
A) The price level will rise, and the level of GDP will fall.
B) The price level will rise, and the level of GDP will be unaffected.
C) The price level will fall, and the level of GDP will fall.
D) The price level will fall, and the level of GDP will rise.
B
Economics
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If households save $0.40 of each additional dollar of increased income and spend the rest, the expenditure multiplier will be
A) 1.67. B) 2.5. C) 4. D) 6.
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Which of the following is a characteristic of bonds?
A) pay zero nominal interest B) can be used for transactions C) are sold for a price that varies inversely with the interest rate D) all of the above E) none of the above
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