Author Question: If the expected price level exceeds the actual price level in an economy, _____. a. firms increase ... (Read 122 times)

Sportsfan2111 · **on:** Jun 30, 2018

If the expected price level exceeds the actual price level in an economy, _____.
a. firms increase production in the short run
b. firms decrease production in the short run
c. firms maintain production in the short run but increase prices
d. firms maintain production in the short run but decrease prices
e. firms raise prices in the short run.

Question 2

If the Fed adopts a contractionary monetary policy, eventually we can expect:
a. aggregate demand to increase.
b. short-run aggregate supply to decrease.
c. interest rates to decrease.
d. planned investment expenditures to decrease.
e. real Gross Domestic Product to increase.