Question 1

If there is a shift in the long-run aggregate supply (LRAS)curve,does the short-run aggregate supply (SRAS)curve also shift? What if the SRAS curve shifts? Does this cause a shift in LRAS?

Accepted Answer

The answer of If there is a shift in the...

Question 2

Consider shifts in aggregate demand that push the level of real GDP (GDP)away from the level of potential output.Explain why,in the long run,RGDP will always return to potential output.

Accepted Answer

The answer of Consider shifts in aggregate demand that push...

Question 3

New drilling technologies lead to a 50 percent increase in oil reserves.How will this impact equilibrium output and the price level?

Accepted Answer

The answer of New drilling technologies lead to a 50...

Question 4

A greater percentage of graduating seniors (at all levels)are able to find a satisfactory job within two months of graduation.How is this likely to impact equilibrium output and the price level in the short run?

Accepted Answer

The answer of A greater percentage of graduating seniors (at...

Question 5

During the latter part of the 1990s,firms purchased new computer systems so that they could establish web sites and eventually online ordering systems.How is this likely to impact the short-run and long-run aggregate supply?

Accepted Answer

The answer of During the latter part of the 1990s,firms...

Question 6

Suppose that the dictator of a small country decides that all prices (both inputs and outputs)must be fixed by contract each year and then renegotiated at the end of each year.What does this imply about short-run aggregate supply (SRAS)?

Accepted Answer

The answer of Suppose that the dictator of a small...

Question 7

An increase in the minimum wage leads to an increase in the unemployment rate for unskilled workers.How is this likely to impact equilibrium output and the price level in the short run?

Accepted Answer

The answer of An increase in the minimum wage leads...

Quiz 26: The Aggregate Demandaggregate Supply Model