The aggregate supply curve is shifted to the left ( inward) by
A. an increase in the price of any input to the production process.
B. a decrease in the price of any input to the production process.
C. the price of any input staying the same.
D. None of the above is correct.
Answer: A
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The EU currently is a preferential trade agreement with no governmental institutions
Indicate whether the statement is true or false
Assume there is a decrease in the market demand for a good sold by price-taking firms that are initially producing the profit-maximizing level of output. How will the market adjust over time?
A) Firms will enter the market, causing price to rise until losses are eliminated. B) Firms will enter the market, causing price to fall until positive profits are eliminated. C) Firms will exit the market, causing price to rise until losses are eliminated. D) Firms will exit the market, causing price to fall until positive profits are eliminated.
Refer to Figure 14.1. Assume that the economy is originally in equilibrium where real GDP equals potential GDP
Other things equal, an increase in the target inflation rate would best be represented as a movement from ________ in the short run and ________ in the long run. A) point Y to point X; point X to point Y B) point Y to point X; will remain at point X C) point Y to point Z; remain at point Z D) point Z to point X; point X to point Z
The production possibilities curve bows outward from the origin because:
A. resources are not of uniform quality. B. more production of one good results in more production of the other good. C. opportunity costs increase as the production of a good increases. D. opportunity costs decrease as the production of a good increases.