Economic growth takes place
A. when aggregate demand decreases.
B. only if the price level is constant or rising.
C. when aggregate supply increases.
D. only when both aggregate demand and aggregate supply increase.
Answer: C
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The rank condition for identification of a structural equation states that the first equation in a two-equation simultaneous equations model is identified if, and only if:
A. the first equation contains at least one exogenous variable (with a nonzero coefficient) that is excluded from the second equation. B. the first equation contains at least two exogenous variables (with a nonzero coefficient) that are excluded from the second equation. C. the second equation contains at least one exogenous variable (with a nonzero coefficient) that is excluded from the first equation. D. the second equation contains at least two exogenous variables (with a nonzero coefficient) that are excluded from the first equation.