Other things constant, if the cost of labor goes down, the profits of firms will
a. increase, and short-run aggregate supply will shift to the right.
b. fall, and short-run aggregate supply will shift to the left.
c. increase, and long-run aggregate supply will shift to the right.
d. fall, and long-run aggregate supply will shift to the left.
A
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John Rawls' theory of justice does not take into account the disincentive effects of redistributive programs
a. True b. False
Suppose the Fed increases the money supply. As a result of this, people deposit excess funds into their bank accounts, causing banks to have excess reserves
As a result, the banks lower the interest rates that they charge on loans, and investment rises, causing an increase in aggregate spending. This is known as a(n) A) direct effect of monetary policy. B) indirect effect of monetary policy. C) direct effect of fiscal policy. D) indirect effect of fiscal policy.