The key concept in the new classical approach to the aggregate supply curve is
A) the impact of imperfect information on business decisions.
B) the impact of changes in the price level on real balances.
C) the inverse relationship between the real interest rate and desired investment spending.
D) the crowding out of investment spending by government spending.
A
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According to Keynes, the effect on planned real investment spending resulting from the interest-rate impact of a decrease in the money supply
A) impacts the economy through the multiplier. B) does not impact the economy. C) impacts the economy by reducing the value of the U.S. dollar. D) impacts the economy by increasing the deficit.
Under the IMF fixed exchange rate system, a nation running a balance of payments surplus would have an excess __________ its currency in the foreign exchange market and that nation's central bank would have to __________ some of its currency
A) supply of; buy B) supply of; sell C) demand for; buy D) demand for; sell