QUESTION 4 Which of the following could contribute to a rightward shift in the a

Question

QUESTION 4 Which of the following could contribute to a rightward shift in the aggregate demand curve? O a business tax cut to promote Investment O new technologies that reduce production costs O a decrease in the money supply O a drop in consumer confidence about the economy QUESTION 5 It is possible for the U.S. to simultaneously run a budget surplus and owe a national debt. O True False QUESTION 6 In the short-run, there is a positive relationship between the aggregate price level and the quantity of goods and services supplied. O True False

Explanation / Answer

Answer : 4) Option b is correct.

We know that demand curve is downward sloping , i.e., demand is negatively related with the price level. As the technology reduces the cost of production, price of the commodity falls in the market which increases the aggregate demand for commodity. As a result the aggregate demand curve shifts from left to right.

5) Option b is correct, i.e., false.

Because the economy of U.S. faces budget deficit for last 45 years. As the economy faces deficit, U.S. owe debt. Therefore, in U.S. budget deficit and national debt runs simultaneously.

6) Option a is correct, i.e., true.

The short run aggregate supply curve is upward sloping. This means that supply is positively related with price level in short run. If price rise then supply increase and vise versa.

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.