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
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According to the substitution effect along an indifference curve, when the relative price of a good falls, the consumer ________ substitutes ________ of that good for the other good
A) always; more B) always; less C) sometimes; more D) sometimes; less
How do a sole proprietorship and a corporation differ?
A) Proprietorships have unlimited liability while corporations have limited liability. B) Corporations face more taxes than do proprietorships. C) Corporations can issue stocks and bonds, while proprietorships cannot. D) All of these are differences between the two types of businesses.
Which currency is most commonly traded?
What will be an ideal response?
Financial crises in advanced economies might start from a
A) debt deflation. B) currency crisis. C) mismanagement of financial innovations. D) currency mismatch.