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Extending The Analysis of Aggregate Supply for Quiz 15 | BM 115, Quizzes of Introduction to Macroeconomics

Mohawk Valley Community College - Utica BranchIntroduction to Macroeconomics

Material Type: Quiz; Class: Prin of Macroeconomics; Subject: Business Management; University: Mohawk Valley Community College-Utica Branch; Term: Unknown 1989;

Typology: Quizzes

Pre 2010

Uploaded on 08/19/2009

koofers-user-idr
koofers-user-idr 🇺🇸

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CHAPTER 15
Extending the Analysis of Aggregate Supply
1. In terms of aggregate supply, a period in which nominal wages and other resource prices are unresponsive
to price-level changes is called the:
A) long run. B) short run. C) immediate market period. D) very long run.
Ans:
2. In terms of aggregate supply, a period in which nominal wages and other resource prices are fully
responsive to price-level changes is called the:
A) long run. B) short run. C) immediate market period. D) very long run.
Ans:
Use the following to answer questions 35-40:
35. Refer to the above diagram. The initial aggregate demand curve is AD1 and the initial aggregate supply
curve is AS1. Demand-pull inflation in the short run is best shown as:
A) a shift of the aggregate demand curve from AD1 to AD2.
B) a move from d to b to a.
C) a move directly from d to a.
D) a shift of the aggregate supply curve from AS1 to AS2.
Ans:
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CHAPTER 15

Extending the Analysis of Aggregate Supply

  1. In terms of aggregate supply, a period in which nominal wages and other resource prices are unresponsive to price-level changes is called the: A) long run. B) short run. C) immediate market period. D) very long run. Ans:
  2. In terms of aggregate supply, a period in which nominal wages and other resource prices are fully responsive to price-level changes is called the: A) long run. B) short run. C) immediate market period. D) very long run. Ans:

Use the following to answer questions 35-40:

  1. Refer to the above diagram. The initial aggregate demand curve is AD 1 and the initial aggregate supply curve is AS 1. Demand-pull inflation in the short run is best shown as: A) a shift of the aggregate demand curve from AD 1 to AD 2. B) a move from d to b to a. C) a move directly from d to a. D) a shift of the aggregate supply curve from AS 1 to AS (^) 2. Ans:
  1. Refer to the above diagram. The initial aggregate demand curve is AD 1 and the initial aggregate supply curve is AS 1. In the long run, demand-pull inflation is best shown as: A) a shift of aggregate demand from AD 1 to AD 2 followed by a shift of aggregate supply from AS 1 to AS (^) 2. B) a move from d to b to a. C) a shift of aggregate supply from AS 1 to AS 2 followed by a shift of aggregate demand from AD 1 to AD 2. D) a move from a to d. Ans:
  2. Refer to the above diagram. The initial aggregate demand curve is AD 1 and the initial aggregate supply curve is AS 1. In the long run, the aggregate supply curve is vertical in the diagram because: A) nominal wages and other input prices are assumed to be fixed. B) real output level Qf is the potential level of output. C) price level increases produce perfectly offsetting changes in nominal wages and other input prices. D) higher than expected rates of actual inflation reduce real output only temporarily. Ans:
  3. Refer to the above diagram. The initial aggregate demand curve is AD 1 and the initial aggregate supply curve is AS 1. Cost-push inflation in the short run is best represented as a: A) leftward shift of the aggregate supply curve from AS 1 to AS2. B) rightward shift of the aggregate demand curve from AD 1 to AD (^) 2. C) move from d to b to a. D) move from d directly to a. Ans:
  4. The traditional Phillips Curve suggests a tradeoff between: A) price level stability and income equality. B) the level of unemployment and price level stability. C) unemployment and income equality. D) economic growth and full employment. Ans:
  5. The traditional Phillips Curve suggests that, if government uses an expansionary fiscal policy to stimulate output and employment: A) unemployment may actually increase because of the crowding-out effect. B) tax revenues may increase even though tax rates have been reduced. C) inflation may result. D) the natural rate of unemployment may fall. Ans:
  6. Stagflation refers to: A) an increase in inflation accompanied by decreases in real output and employment. B) a decline in the price level accompanied by increases in real output and employment. C) a simultaneous increase in real output and the price level. D) a simultaneous reduction in real output and the price level. Ans: