Author Question: Some economists believe that a positive aggregate demand shock to an economy with large amounts of ... (Read 51 times)

DyllonKazuo · **on:** Jun 30, 2018

Some economists believe that a positive aggregate demand shock to an economy with large amounts of excess capacity and unemployment does not necessarily cause an increase in prices. Economists who adhere to this belief are followers of

A) Keynesian economics. B) Say's laws of economics.
C) classical economics. D) supply-side economics.

Question 2

Refer to the above figure. If the price level is 80

A) the total planned real expenditures by individuals, businesses, and the government are less than total planned production by firms.
B) the aggregate demand curve will automatically shift leading to a stable equilibrium.
C) the economy will have economic growth and the new equilibrium price level will be 80.
D) the total planned real expenditures by individuals, businesses, and the government exceed total planned production by firms.