The U.S. economy has had persistent inflation in recent decades. A possible explanation for the inflation is that
A) there have been decreases in the growth rate while aggregate demand has remained unchanged.
B) growth in aggregate demand has been greater than growth in aggregate supply.
C) there have been decreases in aggregate demand while aggregate supply has remained unchanged.
D) there have been increases in the growth rate while aggregate demand has remained unchanged.
B
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In the Keynesian aggregate expenditures model, "aggregate expenditures" refer to:
a. the amount of GDP that could be produced if unemployment were zero. b. the combined expenditures of consumers, businesses, governments, and foreigners (net exports). c. the amount of demand for consumer goods that would arise if all citizens had all the income they wanted. d. consumer spending measured in constant prices.
If consumers expected the price of a good to increase in the near future and the price of a complement good decreased at the same time, as a result: a. prices would rise
b. prices would fall. c. larger quantities to be exchanged. d. both prices and quantities exchanged would increase.