Changes in aggregate spending not caused by changes in output or the inflation rate, also known as exogenous changes in spending, will shift the:
A. short-run aggregate supply curve.
B. potential output line.
C. aggregate demand curve.
D. long-run aggregate supply curve.
Answer: C
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What are the factors that contribute to productivity growth in the market economy and which of them is considered most important?
When a competitive firm maximizes profit, it will hire workers up to the point where the
a. marginal product of labor is equal to the product price. b. marginal product of labor is equal to the wage. c. value of the marginal product of labor is equal to the product price. d. value of the marginal product of labor is equal to the wage.
A Keynesian short-run aggregate supply curve has a flatter portion and a steep portion. How does a decrease in aggregate demand affect the actual real GDP differently across these two portions?
a. There is a large decrease in the actual real GDP across the flatter portion and a small decrease in the actual real GDP across the steep portion. b. There is a large increase in the actual real GDP across the flatter portion and a small increase in the actual real GDP across the steep portion. c. There is a small decrease in the actual real GDP across the flatter portion and a large increase in the actual real GDP across the steep portion. d. There is a small increase in the actual real GDP across the flatter portion and a large increase in the actual real GDP across the steep portion.
The growth rate of real GDP is best represented as
A) (Contribution from capital) + (Contribution from labor) + (Contribution from total factor productivity) B) (Contribution from capital + Contribution from labor) / (Contribution from total factor productivity) C) (Contribution from total factor productivity) / (Contribution from capital + Contribution from labor) D) (Contribution from capital) × (Contribution from labor) × (Contribution from total factor productivity)