Answer the following statement(s) true (T) or false (F)
1. The aggregate demand curve can shift to the right or left due to changes in price levels.
2. A decrease in a nation’s population will increase aggregate demand.
3. A fall in incomes abroad can reduce U.S. net exports and cause a leftward shift in the U.S. aggregate demand curve.
4. Input prices are said to be sticky in the long run.
5. The misperception effect involves a false perception about relative prices.
1. False
2. False
3. True
4. False
5. True
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The basic economic problem is a situation of
A) limited resources and unlimited wants. B) both limited resources and limited wants. C) limited incomes and unlimited choices. D) unlimited incomes and limited choices.
Refer to the graph. Other things equal, an increase in labor productivity would cause a:
A. move from a to b on D 1 .
B. shift from D 2 to D 3 .
C. shift from D 3 to D 2 .
D. move from b to a on D 1 .