True/False
As the price level falls, the holders of money become richer with higher real purchasing power and as a result, they buy more. This is one reason why the aggregate demand curve is downward sloping.
Correct Answer:
Verified
Correct Answer:
Verified
Q77: The interest-rate and wealth effects are important
Q78: Fiscal policy and/or monetary policy:<br>A) change aggregate
Q79: Estimates in recent years put the natural
Q80: The substitution (trade-effect) shows that:<br>A) an increase
Q81: An unemployment rate greater than the natural
Q82: During the recessions of the early 1980s
Q83: The potential output line is:<br>A) vertical because
Q85: The aggregate demand - aggregate supply model
Q86: A recessionary gap refers to the:<br>A) amount
Q87: If potential output exceeds aggregate demand:<br>A) an