Author Question: Which of the following explains why higher prices in the goods and services market measured by the ... (Read 55 times)

s.tung

  • Hero Member
  • *****
  • Posts: 577
Which of the following explains why higher prices in the goods and services market measured by the CPI leads to an upward-sloping aggregate supply curve?
 a. The higher prices will temporarily improve profit margins because the cost of wages and salaries are fixed in the short run.
  b. The higher prices will reduce the purchasing power of the fixed quantity of money and, thereby, stimulate additional output.
  c. The higher prices will expand the economy's resource base and, thereby, stimulate additional output.
 d. The higher prices will improve technology and, thereby, stimulate additional output.

Question 2

If the fractional reserve system did not exist,
 a. the banking system could not create money.
  b. there would be no effect on the ability of the banking system to create money.
  c. banks would loan out its required reserves.
  d. banks would be highly susceptible to bank runs.
  e. the banking system would realize the money multiplier.



kalskdjl1212

  • Sr. Member
  • ****
  • Posts: 353
Answer to Question 1

a

Answer to Question 2

a



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Malaria mortality rates are falling. Increased malaria prevention and control measures have greatly improved these rates. Since 2000, malaria mortality rates have fallen globally by 60% among all age groups, and by 65% among children under age 5.

Did you know?

Between 1999 and 2012, American adults with high total cholesterol decreased from 18.3% to 12.9%

Did you know?

Certain topical medications such as clotrimazole and betamethasone are not approved for use in children younger than 12 years of age. They must be used very cautiously, as directed by a doctor, to treat any child. Children have a much greater response to topical steroid medications.

Did you know?

Blood is approximately twice as thick as water because of the cells and other components found in it.

Did you know?

Signs and symptoms that may signify an eye tumor include general blurred vision, bulging eye(s), double vision, a sensation of a foreign body in the eye(s), iris defects, limited ability to move the eyelid(s), limited ability to move the eye(s), pain or discomfort in or around the eyes or eyelids, red or pink eyes, white or cloud spots on the eye(s), colored spots on the eyelid(s), swelling around the eyes, swollen eyelid(s), and general vision loss.

For a complete list of videos, visit our video library