If the economy experiences an inflationary gap, a contractionary monetary policy will
A) increase real GDP and increase the price level.
B) increase real GDP and decrease the price level.
C) decrease real GDP and increase the price level.
D) decrease real GDP and decrease the price level.
Ans: D) decrease real GDP and decrease the price level.
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Which of the following is important in determining the extent of competition in an industry?
A) the level of market demand for the industry's product B) whether or not the industry product is differentiated or standardized C) the minimum efficient scale of production relative to market demand D) the minimum level of short-run average total costs of production
The neoclassical view is not especially helpful in explaining why __________ moves up and down over short time horizons of a few years.
a. demand b. unemployment c. prices d. inflation