Demand-pull inflation is caused by a rightward shift of the aggregate demand curve
a. True
b. False
Indicate whether the statement is true or false
True
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Agriculture, clothing, and textiles are singled out for treatment in the chapter because
A) they tend to be the most highly protected sectors of industrial economies. B) they tend to be the least-protected sectors internationally. C) the policies of high-income nations in these sectors may have harmful effects in low-income countries. D) A and C are both correct. E) B and C are both correct.
If the MPC is 0.8 and net taxes increase by $100 billion, what is the effect on equilibrium output?
a. There is no effect; equilibrium output is not affected by a change in net taxes. b. Equilibrium output will fall by $80 billion. c. Equilibrium output will fall by $125 billion. d. Equilibrium output will fall by $400 billion. e. Equilibrium output will fall by $500 billion.