According to the new classical system,
a. an anticipated change in aggregate demand will cause labor suppliers to make price forecast errors and will, therefore, affect output and employment.
b. anticipated changes in aggregate demand will not affect output and employment because labor suppliers have perfect information about the price level.
c. unanticipated changes in aggregate demand will shift both the aggregate demand schedule and the aggregate supply schedule.
d. both b and c.
e. None of the above
B
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Normative economics answers the question, "What ought to be?" Positive economics predicts the consequences of alternative actions, answering the questions, "What is?" or "What will be?"
Indicate whether the statement is true or false
Microeconomics is the branch of economics that deals with
A) highly aggregated markets or the entire economy. B) the production side of the economy, exclusively. C) the buying side of the economy, exclusively. D) human behavior and choices as they relate to relatively small units --- an individual, a firm, an industry.