Suppose the economy starts out at point A. Next, the public anticipates that the Fed will use expansionary monetary policy to shift the AD curve from AD1 to AD2. What happens, instead, is that the Fed does not raise aggregate demand as much as the public expects (bias upward). Instead the Fed pushes the AD curve from AD1 to AD3. As a result, according to new classical theory in the short run the economy moves to point:.

Power plants that rely on coal increase the amount of sulfur dioxide that dissolves into the air, eventually increasing the acidity of precipitation. the higher acidity of rain and snow can damage forests by making it more difficult for plants to absorb minerals from the soil. the equations below provide information about the market demand and supply of electricity. there is a constant marginal external cost of $25 per unit of electricity.d: qd= 200 – 2ps: qs=p – 10what quantity of electricity satisfies allocative efficiency in this market? a. 60b. 70c. 50d. 43.3