Which of the following is most likely to throw an economy into a recession?
a. a reduction in the real interest rate
b. an unanticipated increase in short-run aggregate supply
c. an unanticipated increase in aggregate demand
d. an unanticipated reduction in aggregate demand
D
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Robert got a new job and relocated to a different city. He initially decided to rent a small apartment close to his office
However, he decided to live in a much bigger and costlier apartment when he found out that his employer will pay him a house rent allowance. This is an example of ________. A) adverse selection B) moral hazard C) the prisoners' dilemma D) the free-rider problem
Jim Smith runs a company that sells encyclopedia sets for $200 each. When he employs 5 workers, they can sell 20 sets per week, while only 17 sets are sold when 4 workers are employed. If the wage of workers in this skill category is $500 per week, should the fifth worker be hired?
a. No, because the MRP of the fifth worker is less than $500 per week. b. No, because the MRP of the fifth worker is more than $500 per week. c. Yes, because the MRP of the fifth worker is less than $500 per week. d. Yes, because the MRP of the fifth worker is more than $500 per week.