The wealth effect and the interest rate effect are changes in the price level that:
a. bring about a movement along the aggregate demand curve.
b. lead to a shift of the demand curve for a particular good.
c. result in a shift of the aggregate supply curve.
d. help explain the vertical shape of the long-run aggregate supply curve.
e. cause a movement along the aggregate supply curve.
Question 2
A person behaving rationally will:
a. never make mistakes.
b. make decisions that are random and chaotic.
c. have others determine whether their decisions are rational.
d. try to weigh the expected marginal benefits and marginal costs of their decision.
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