Author Question: Which of the following schools of thought reject the simple fixed-price model in favor of a model in ... (Read 113 times)

cherise1989 · **on:** Jun 30, 2018

Which of the following schools of thought reject the simple fixed-price model in favor of a model in which the aggregate supply curve is relatively flat at low levels of real GDP and slopes upward as real GDP approaches its potential level?
a. The new Keynesian
b. The monetarist
c. The traditional classical
d. The new classical
e. The Marxist

Question 2

A jeweler cut prices in his store by 20. As a result:
a. Its total revenue would fall by 20 if the elasticity of demand was zero.
b. Its total revenue would fall, but by less than 20 if the elasticity of demand is greater than zero but less than one.
c. Its total revenue would rise if the elasticity of demand is greater than one.
d. All of the above would be true.