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Author Question: Use the figure above to answer this question. At a price level of 90 A) people will be forced to ... (Read 25 times)

dmcintosh

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on: Jun 29, 2018
Use the figure above to answer this question. At a price level of 90
 
  A) people will be forced to cut consumption so that aggregate demand will decrease.
  B) the aggregate quantity demanded exceeds real GDP and inventories will decrease.
  C) inventories increase and firms will increase production.
  D) the aggregate quantity demanded exceeds real GDP, inventories increase and the price level will rise.

Question 2

Suppose that the nominal quantity of money is 200 billion and the value of nominal GDP is 1 trillion. It must be the case that
 
  A) the economy is suffering from inflation.
  B) the average price paid for a typical good is 5.
  C) there will be a shortage of money balances in the economy.
  D) the velocity of circulation is 5.


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elyse44

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Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

D


dmcintosh

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Reply 2 on: Jun 29, 2018
Excellent

billybob123

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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