New Keynesians argue that a decrease in government spending reduces inflation

In the above figure, if household consumption is positively related to household income, then an increase in household income will

A) shift the line rightward. B) shift the line leftward. C) make the line positively sloped. D) cause a movement along the line.

For a perfectly competitive firm, in the long-run equilibrium

A) P = MC = ATC = MR. B) MR = MC = AFC. C) MR = P = ATC = AFC. D) P = MC > ATC.