Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward
B. Short-run aggregate supply shifting downward
C. Aggregate demand shifting rightward
D. Aggregate demand shifting leftward
Answer: B
You might also like to view...
A form of business whose profits are taxed twice is
A) a proprietorship. B) a partnership. C) a corporation. D) either a proprietorship or a partnership, depending on other information.
A numerical limit imposed by a government on the quantity of a good that can be imported into the country is called a
A) barricade. B) quota. C) tariff. D) quantity floor.
Decreases in autonomous spending cause rightward shifts of the aggregate demand and supply curves
Indicate whether the statement is true or false
Fluctuating interest rates tend to stabilize real output when the
A) IS curve is flat. B) IS curve is steep. C) LM curve is flat. D) LM curve is steep.