In the short-run, real GDP can be greater than or less than potential GDP because in the short run the
A) money wage rate is fixed.
B) quantity of capital is fixed.
C) full-employment level of employment is fixed.
D) price level is fixed.
A
You might also like to view...
The aggregate supply curve shows the relationship between the price level and the level of real GDP produced by the nation's economy
a. True b. False Indicate whether the statement is true or false
If firms in a competitive price-searcher market are incurring economic losses, which of the following scenarios would best describe the change existing firms (who are able to stay in the market) would face as the market adjusts to long-run equilibrium?
a. An increase in demand for each firm and lower prices. b. A decrease in demand for each firm and lower prices. c. An increase in demand for each firm and higher prices. d. A decrease in demand for each firm and higher prices.
Based on this graph, which of the following shifts would cause the greatest decrease in money supply?
a. a shift from i2 to i1
b. a shift from i1 to i*
c. a shift from i* to i2
d. a shift from i1 to i2
A year-long drought that destroys most wheat crops for the season would shift the:
A. short-run aggregate supply curve only. B. aggregate demand curve only. C. aggregate demand curve, and the short-run aggregate supply curve would shift in response. D. short-run aggregate supply curve and the long-run aggregate supply curve.