Other things the same, what happens to the price level and quantity of output when an adverse shift in the short run aggregate supply curve occurs?
Price level increases and output decreases
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The command system relies on prices set by firms on the basis of consumer demands
a. True b. False Indicate whether the statement is true or false
One of the effects of a price floor (set above equilibrium price) is
A) a surplus. B) higher-quality goods are produced. C) more satisfied customers. D) all of the above E) none of the above
The ________ is a measure of the price level and is calculated by dividing ________ by ________ and multiplying by 100
A) CPI; real GDP; nominal GDP B) GDP deflator; real GDP; nominal GDP C) GDP deflator; nominal GDP; real GDP D) PPI; nominal GDP; real GDP E) PPI; real GDP; nominal GDP
Answer the following statements true (T) or false (F)
1. When the total product is at its maximum level, the marginal product is zero. 2. hen total product is increasing at a decreasing rate, marginal product is positive, but falling. 3. The short-run marginal-cost curve is upward-sloping because of the law of diminishing marginal returns. 4. Marginal product is highest where marginal cost is lowest. 5. When a firm increases its output, its average fixed costs will stay constant.