If there is currently a recessionary gap, a decrease in aggregate demand would make the recessionary gap larger

When the economy is hit by a temporary negative supply shock and the central bank does not respond by changing the autonomous component of monetary policy, then in the long run

A) inflation will be lower. B) output will be at its potential. C) output will be lower. D) inflation will be unchanged. E) both B and D.

If Monica has a comparative advantage in baking and George has a comparative advantage in sewing, then

a. Monica must have an absolute advantage in baking b. Monica must have an absolute advantage in sewing c. George must have an absolute advantage in baking d. George must have an absolute advantage in sewing e. we can conclude nothing about absolute advantage