In the new Keynesian model, the ultimate effect on output of an anticipated aggregate demand shock is ________
A) less than if that event was unanticipated
B) greater than if that event was unanticipated
C) the same as would develop if that event had never occurred
D) dependent on whether or not that event is temporary or permanent
C
You might also like to view...
Individual firms in a perfectly competitive market can
a. purchase all they want at the market price b. sell all they produce at the market price c. earn more profit if they charge a price above the market price d. earn more profit if they charge a price below the market price e. earn no profit in the short run
When Firm A increased its production last year, its average total cost of production decreased. On the other hand, Firm B also increased its production last year, but its average total cost of production increased. Considering the given situation, which of the following statements is true of the two firms?
a. The size of the plant in Firm A is smaller than the size of the plant in Firm B. b. Firm A is operating with increasing returns to scale, while Firm B is operating with decreasing returns to scale. c. Firm A is operating with decreasing returns to scale, while Firm B is operating with increasing returns to scale. d. Firm A invests more on labor and cheaper variable costs, while Firm B invests more in expensive machinery.