Holding the level of prices fixed implies that a given increase in aggregate demand
A) will have a smaller effect on real GDP than would be the case if prices were more flexible.
B) will have a larger effect on real GDP than would be the case if prices were more flexible.
C) has the same effect on real GDP as when prices are more flexible.
D) has a smaller effect on nominal GDP than when prices are more flexible.
B
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The efficient price of a license fee is determined by the difference between
a. Marginal revenue and marginal cost b. Average revenue and marginal cost c. Total revenue and total cost d. Average revenue and total cost e. Total revenue and marginal cost
Refer to Figure 2-6. If the economy is currently producing at point D, what is the opportunity cost of moving to point B?
A) 8 thousand wrenches B) 30 thousand wrenches C) 23 thousand hammers D) 0 hammers