A production possibilities curve shows the various combinations of two outputs that:
a. an economy should produce.
b. an economy can produce.
c. consumers would like to consume.
d. producers would like to produce.
b
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A ________ occurs when government spending exceeds tax revenue
A) budget deficit B) negative externality C) consumer surplus D) positive externality
Why does the short-run aggregate supply curve shift to the left in the long run, following an increase in aggregate demand?
A) Workers and firms adjust their expectations of wages and prices upward and they push for higher wages and prices. B) Workers and firms adjust their expectations of wages and prices upward and they accept lower wages and prices. C) Workers and firms adjust their expectations of wages and prices downward and they push for higher wages and prices. D) Workers and firms adjust their expectations of wages and prices downward and they accept lower wages and prices.