Suppose that when income rises, the demand curve for doctor's visits shifts to the right. In this case, we know doctor's visits are
a. inferior goods.
b. normal goods.
c. perfectly competitive goods.
d. durable goods.
b
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Other things the same, which of the following could explain a rise in Sweden's net capital outflow?
a. interest rates on Swedish bonds rise b. the probability of default on Swedish bonds rises c. Sweden enacts a law reducing taxes on income earned by foreign-owned businesses operating in Sweden d. None of the above are correct.
Assume the economy is initially in equilibrium on AD2 and AS2. Which curve would have shifted, and in what direction would it have shifted, if a new equilibrium were to occur at an output level of $300 billion and a price level of P3 in Figure 8.3?
A. Aggregate supply would have shifted to the left. B. Aggregate supply would have shifted to the right. C. Aggregate demand would have shifted to the right. D. Aggregate demand would have shifted to the left.