In the figure above, the economy is at an equilibrium with real GDP of $16 trillion and a price level of 110. As the economy moves toward its ultimate equilibrium, the ________ curve shifts ________ because ________
A) aggregate supply; leftward; the money wage rate rises
B) aggregate supply; rightward; the money wage rate falls
C) aggregate demand; rightward; the money wage rate falls
D) aggregate demand; leftward; the money wage rate rises
E) potential GDP; leftward; the money wage rate falls
B
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Suppose the actual equilibrium federal funds rate is above the rate implied by a particular inflation goal. In this situation, the Taylor rule implies that
A) monetary policy is contractionary. B) monetary policy is expansionary. C) fiscal policy is expansionary. D) fiscal policy is contractionary.
A worker who loses his or her job as a consequence of a decline in aggregate demand in the economy is experiencing:
a. disguised unemployment. b. underemployment. c. cyclical unemployment. d. frictional unemployment. e. seasonal unemployment.
Other things equal, relatively poor countries tend to grow
a. slower than relatively rich countries; this is called the poverty trap. b. slower than relatively rich countries; this is called the fall-behind effect. c. faster than relatively rich countries; this is called the catch-up effect. d. faster than relatively rich countries; this is called the constant-returns-to-scale effect.
Franchises with the lowest team revenues in their league
A. usually find it difficult both to win and make money in the same season. B. make it into the playoffs much more often than other teams. C. sign by far the most talented players among the free agents. D. build the largest number of luxury suites due to the intense loyalty of their diehard fans.