What impact did the change in housing prices during 2002 to 2005 have within the framework of the AD/AS model?
a. Declining housing prices reduced aggregate demand shifting AD leftward.
b. Rising housing prices increased aggregate demand shifting AD rightward.
c. Rising housing prices led to increased construction shifting LRAS leftward.
d. Declining housing prices caused SRAS to shift leftward.
B
Economics
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Refer to the figure above. At what level of output does the firm maximize profits?
A) 0 units B) 10 units C) 20 units D) 30 units
Economics
In the Keynesian model in the short run, what is likely to happen to employment after each of the following shocks?
(a) An increase in taxes (b) An increase in consumer spending generated by a reduced desire for saving (c) An increase in the money supply
Economics