Based on the graph above, suppose the economy is at point 2, then output falls to 10 and there is a price shock of one percent. The inflation rate next period will be ________ percent

What determines the the real interest rate in the long-run classical model?

A. aggregate supply and demand B. money supply and demand C. savings and investment D. inflation

When both exports and imports are considered, the major advantage of international trade is that it allows us to

a. seclude ourselves from foreign products. b. consume a larger, more diverse quantity of goods and services at lower prices than would otherwise prevail. c. benefit at the expense of less-developed nations d. maintain jobs for workers who would otherwise have little to do.