If Eric expects to earn more income next month, he may choose to ...

[madam-professor]

If Eric expects to earn more income next month, he may choose to
 a. save more now and spend less of his current income on goods and services.
  b. save less now and spend more of his current income on goods and services.
  c. decrease his current demand for goods and services.
 d. decrease his current demand for goods and services.

Question 2

If the profit effect and misperception effect existed in both the short run and the long run, then SRAS is ____ and LRAS is ____.
 a. upward sloping; upward sloping
  b. upward sloping: vertical
 c. vertical; upward sloping
 d. vertical; vertical

[Tonny]

Answer to Question 1

c

Answer to Question 2

a