Which of the following is false?
A) Starting from full employment, an unexpected drop in aggregate demand causes a demand-induced recession.
B) If policymakers do nothing in response to an unexpected drop in aggregate demand, the short-run aggregate supply curve eventually shifts to the right as firms and workers adjust their price expectations downward.
C) If policymakers do nothing in response to an unexpected drop in aggregate demand, the economy eventually returns to full employment at a higher price level.
D) In response to a drop in aggregate demand, if policymakers choose to boost demand through fiscal or monetary policy, then the economy returns to full employment at the original price level.
Correct Answer:
Verified
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Q15: Which of the following acts followed the
Q16: To be unemployed, an individual must be
A)in
Q17: Any event that shifts the short-run aggregate
Q18: Which of the following choices best explains
Q20: In looking at the cyclical pattern of
Q21: The productivity of capital is thought to
Q22: From the economic perspective, the willingness of
Q23: An unstable economic environment will likely cause
Q24: Price stability means
A)zero inflation.
B)low inflation.
C)regulated inflation.
D)an inflation
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