An adverse supply shock will shift short-run aggregate supply
a. right, making prices rise.
b. left, making prices rise.
c. right, making prices fall.
d. left, making prices fall.
b
You might also like to view...
According to the law of supply, producers will
A) change their consumption plans when the price of a good changes. B) change their supply when the price of a good changes. C) change their production plans when the price of a good changes. D) increase their quantity supplied when the price of a good decreases. E) decrease their quantity supplied when the price of a good increases.
What will happen to the equilibrium price and equilibrium quantity of ice cream cones when consumers' incomes decrease?
A) If ice cream cones are a normal good, then the equilibrium price and quantity of ice cream cones will decrease. B) If ice cream cones are a normal good, then the equilibrium price and equilibrium quantity of ice cream cones will increase. C) If ice cream cones are an inferior good, then the equilibrium price for an ice cream cone will increase and the equilibrium quantity of ice cream cones will decrease. D) If ice cream cones are an inferior good, then the equilibrium price and quantity of ice cream cones will decrease.
When firms incur unplanned inventories, they typically
a. build new plants. b. call for more government spending. c. hire more workers and increase production. d. lay off workers and reduce production.
Suppose a bank has $2 million in deposits, a required reserve ratio of 10 percent, and total reserves of $500,000. Then it has excess reserves of
A. $200,000. B. $500,000. C. $300,000. D. $50,000.