During an inflationary gap,
A) the aggregate demand curve and the aggregate supply curve intersect at a level of real GDP that exceeds potential GDP.
B) the aggregate demand curve and the aggregate supply curve intersect at potential GDP.
C) the aggregate demand curve and the aggregate supply curve do not intersect.
D) real GDP is less than potential GDP.
E) the price level will fall to restore the long-run equilibrium.
A
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Indicate whether the statement is true or false
Which of the following is a method by which a poor country might import technological change without having to incur the heavy expense of research and development (not to mention human and physical capital formation) out of its own saving?
A) Copy modern products made in rich countries. B) Purchase imported machinery that embodies the latest technology. C) Obtain investment by foreign firms. D) All of the above.