In the short run, if current output remains persistently above potential ________
A) inflation will rise causing a movement along the aggregate supply curve
B) expected inflation will rise causing an upward shift of the aggregate supply curve
C) the aggregate supply curve will shift until current output returns to its potential level
D) all of the above
E) none of the above
D
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How does the federal government finance a budget deficit?
A) It borrows funds by selling Treasury bonds. B) It cuts spending on entitlement programs. C) It redeems its IOUs. D) It purchases U.S. Treasury bonds.
What is the Degree of Operating Leverage?
What will be an ideal response?
The statement "The unemployment rate in the U.S. was 5 percent last month" is
a. a value judgment b. an economic opinion c. a normative statement d. a positive statement e. totally beyond anything that should be permitted by modern society
Opportunity cost refers to:
A. the amount of dollars that have to be spent in order to employ a resource. B. the cost of employing one more unit of a resource. C. a cost that a decision maker has already incurred. D. the cost associated with foregoing the opportunity to employ a resource in its best alternative use.