When we compare PAE and actual output (Y) if PAE is greater than Y we expect that:
A. eventually production will decrease.
B. eventually production will increase.
C. there will be no change in aggregate production.
D. the government will intervene by cutting down on taxes.
B. eventually production will increase.
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The tyranny of collateral ________
A) suggests that government tax rates are too high in the United States B) gives rise to the twin problems of moral hazard and adverse selection C) implies that when a poor person has a good idea they find it difficult to acquire financing D) attributes moral hazard to excessive government regulation
The aggregate supply curve shows the:
a. Direct relationship between the price level and real GDP purchased b. Direct relationship between the price level and real GDP produced c. Inverse relationship between the price level and real GDP purchased d. Inverse relationship between the price level and real GDP produced