If aggregate expenditures are lower than real GDP:
A. actual real output is less than equilibrium real output.
B. aggregate output increases.
C. employment increases.
D. there will be unplanned increases in inventories.
D. there will be unplanned increases in inventories.
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If the Fed is worried about inflation and wants to raise the interest rate, in the short run it can
A) increase the demand for money. B) decrease the demand for money. C) increase the quantity of money. D) decrease the quantity of money. E) directly raise the interest rate without affecting either the demand for money or the supply of money.
Most t-shirts bought by Americans are made in Asia. Producers in Asia making t-shirts trade with America because they
A) cannot produce enough t-shirts for their own domestic consumption. B) receive a higher price than they would receive from another buyer. C) cannot lower their price any lower and still make a profit. D) must export something to the United States. E) receive a lower price than they would receive from another buyer.