Answer:
B) The SRAS curve will shift to the right, and the short‐run Phillips curve will shift downward.
Explanation:
When the price of key inputs decreases, then the short-run aggregate supply (SRAS) curve shifts to the right, generally resulting in higher production levels (higher supply) due to lower production costs. On the other hand, when the price of key inputs increases, then the SRAS curve shifts to the left.
When inflation expectations decrease or SRAS curve shifts to the right, the short-run Phillips curve shifts to the left.
Answer:
a. GDP will increase
b. No effect on GDP
c. GDP will increase
d. GDP will increase
e. GDP will rise
Explanation:
Gross domestic product is the total monetary value of all the finished goods produced in the country during a specific period. When a new house is constructed it will create value for the economy and GDP will rise but when an old house is resold again there is no addition in the monetary value so there will be no effect on GDP.
Answer:
The correct answer is option B.
Explanation:
A recessionary gap implies that the resources are not being fully utilized. This means resources are being wasted.
An expansionary gap, on the other hand, means that the economy is producing at more than potential level. The price level at this point is high. There is a tendency for inflation to develop in this situation.
To curb the recessionary gap the economy can adopt the expansionary fiscal and monetary policy. While to curb expansionary gap, contractionary monetary and fiscal policy can be adopted.
Answer:
$60
Explanation:
The computation of interest revenue is shown below:
= Note receivable amount × rate of interest × given number of months ÷ (total number of months in a year)
= $1,000 × 12% × (6 months ÷ 12 months)
= $60
Basically we multiplied the note receivable amount with the interest rate and the given number of months so that the interest revenue could come
Answer:
The correct answer is letter "D": free-rider mechanism.
Explanation:
The free-rider mechanism refers to someone being able to get for less or even for free what others pay more for. The problem comes when individuals are unwilling to pay their fair share for something that most others pay for. This is more prevalent when talking about public goods.
