Neoclassical economists; short run
QUESTION 22
If the price level of what firms produce is rising across an economy, but the costs of produc
the maximum potential GDP will be exceeded.
increase in quantity produced won't be large.
a majority of industries will start running into limits.
higher profits will induce expanded production.
QUESTION 23
The effects of inflation are seen in:
goods and services only
wages and income levels only
services and wages only
goods, services, wages and income levels
QUESTION 24
The effect of substitution bias is that the rise in the price of a fixed basket of goods over time
a consumer's true cost of living, because it doesn't take into account that the person can subs
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