Which of the following statements represents a correct and sequentially accurate economic explanation?
A) Wage rates rise, SRAS rises, and the SRAS curve shifts to the left.
B) The prices of nonlabor inputs rise, SRAS decreases, and the SRAS curve shifts to the right.
C) Labor productivity rises, SRAS increases, and the SRAS curve shifts to the right.
D) An adverse supply shock hits, SRAS decreases, and the SRAS curve shifts to the right.
E) a and c
C
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A shortage will occur whenever
A) price is below the equilibrium price. B) price is above the equilibrium price. C) price is equal to the equilibrium price. D) the supply curve is upward sloping.
Government transfer payments are income earned by individuals who work for the federal government
a. True b. False Indicate whether the statement is true or false
You are a member of Congress in 2007–2009 when the economy is in a recessionary gap. If your goal is to achieve full employment, you should vote for
A. decreased government purchases, increased taxes, and a cut in transfer payments. B. a balanced federal budget. C. increased government purchases, decreased taxes, and an increase in transfer payments. D. increased government purchases and transfer payments, and an equal increase in taxes.
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.