In the above figure, starting at E1, if there is a supply shock that is temporary, the
A) aggregate supply would shift to SRAS1 and LRAS0 would shift to LRAS1.
B) aggregate supply would shift to SRAS2 and LRAS0 would shift to LRAS1.
C) aggregate supply would shift to SRAS1 and then return to SRAS0.
D) aggregate supply would shift to SRAS0 and LRAS1 would shift to LRAS0.
C
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Suppose the economy is at the natural real GDP. Changing macroeconomic policy to lower the interest rate while not affecting output means shifting the IS curve to the ________ and the LM curve to the ________
A) right, right B) right, left C) left, right D) left, left
In the monetary small open-economy model with a fixed exchange rate, the domestic
A) government loses control over the level of domestic government spending. B) government loses control over the level of domestic taxes. C) government loses control over the level of domestic government spending and domestic taxes. D) central bank loses control over the domestic stock of money.
An example of a black market is
A) a retail market. B) a discount market. C) scalping. D) barter.
A positive nominal interest rate indicates
a. how fast the number of dollars in your savings account is rising over time. b. how fast the purchasing power of your savings account is rising over time. c. the number of dollars in your savings account today. d. the purchasing power in your savings account today.