The more a nation depends on imported raw materials, the ________ closely linked is its marginal cost to its nominal aggregate demand, thus the ________ for the typical firm is a policy of indexing price to nominal aggregate demand

The more closely substitutable are two goods, the

A) more normal looking is the indifference curve for the two items. B) more closely the indifference curve for these two items approximates a straight line. C) more tightly curved is the indifference curve for these items. D) None of the above answers is correct.

A negative demand shock would lead to a decline in both the price level and output in the short run

a. True b. False