In the dynamic aggregated demand and aggregate supply model, inflation occurs if
A) SRAS shifts faster than AD.
B) AD shifts slower than SRAS.
C) LRAS shifts faster than AD.
D) AD shifts faster than SRAS.
D
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Refer to the above table. If gross investment is $34 billion, net exports are zero, and there is a lump-sum tax of $30 billion at all levels of GDP, then the after-tax equilibrium level of GDP will be:
The data below is the consumption schedule in an economy. All figures are in billions of dollars.
A. $490 billion
B. $540 billion
C. $590 billion
D. $640 billion
Wes works as a delivery man and can work as many hours as he likes for $12 an hour. He typically works 40 hours a week. Recently, his pay has been cut, and Wes decides to work:
A. less hours, because the income effect dominates his labor supply decision. B. the same amount, because the price effect dominates his labor supply decision. C. more hours, because the price effect dominates his labor supply decision. D. more hours, because the income effect dominates his labor supply decision.