Which of the following best describes the eclectic aggregate supply curve?
A. Horizontal until full employment is reached, and then it becomes vertical.
B. Vertical at all output levels.
C. First horizontal, then upward sloping, and finally vertical.
D. Downward sloping.
C. First horizontal, then upward sloping, and finally vertical.
You might also like to view...
A Roth IRA differs from a traditional IRA in that
A. the Roth IRA allows for savings towards retirement. B. the Roth IRA is phased out at certain income levels. C. the Roth IRA is not tax deductible at the time it is deposited. D. all of these answer options are correct.
A person who believes the economy is self-regulating also believes that
A) when there is a surplus in the labor market, the wage rate falls, and when there is a shortage in the labor market, the wage rate rises. B) it is better if the economy is in an inflationary gap than a recessionary gap. C) prices are flexible but wages are not. D) the economy is always in long-run equilibrium. E) the real balance effect does not operate in a recessionary gap.
Figure 15-3
As shown in , if people behave according to adaptive expectations theory, an increase in the aggregate demand curve from AD1 to AD2 will cause
a.
labor to adjust nominal wages sluggishly.
b.
the aggregate supply curve to shift from SRAS1 to SRAS2
c.
the price level to eventually rise from 100 to 110.
d.
All of the above.
If in the short run total product is decreasing as more workers are hired, then the marginal physical product is
A) increasing. B) zero. C) negative. D) positive.