Solved

-According to Classical Economics, If Aggregate Demand Were at AD2

Question 83

Multiple Choice

-According to classical economics, if aggregate demand were at AD<sub>2</sub> and prices and wages were at P<sub>1</sub>W<sub>1</sub>: A) aggregate supply would shift to the left. B) prices and wages would fall from P<sub>1</sub>W<sub>1</sub> to P<sub>2</sub>W<sub>2</sub>. C) aggregate demand would increase from AD<sub>2</sub> to AD<sub>1</sub>. D) the economy would continually operate with unemployed resources.
-According to classical economics, if aggregate demand were at AD2 and prices and wages were at P1W1:


A) aggregate supply would shift to the left.
B) prices and wages would fall from P1W1 to P2W2.
C) aggregate demand would increase from AD2 to AD1.
D) the economy would continually operate with unemployed resources.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q78: Monetarism is the school of thought that

Q79: If, using the Keynesian approach, total output

Q80: According to Keynes, if the economy is

Q81: New classical economics and classical economics both:<br>A)

Q82: The new classical economists hold that rational

Q84: The policy implication of new Keynesian economics

Q85: In the new classical model, the aggregate

Q86: In which of the following economic theories

Q87: According to the Keynesian approach, if leakages

Q88: The natural rate of unemployment occurs when