In new classical economics, the change in output caused by a "price-level surprise":
A. is shown as a shift of the long-run aggregate supply curve.
B. does not alter the rate of unemployment, even in the short run.
C. is soon reversed through a shift of the short-run aggregate supply curve.
D. permanently changes the rate of unemployment.
C. is soon reversed through a shift of the short-run aggregate supply curve
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Workers earn less than half of the income generated by the production process.
Answer the following statement true (T) or false (F)
A ________ in the long-run real interest rate ________ household's demand for durable goods
A) fall; increases B) rise; increases C) rise; does not affect D) fall; lowers
A swap contract __________ be resold, which is particularly important for the __________ in swaps
A) can; speculator B) can; hedger C) cannot; speculator D) cannot; hedger
In the real intertemporal model with investment
A) the firm maximizes the present value of profits. B) the firm maximizes current profits. C) the firm maximizes the present value of revenues. D) the firm maximizes current profits plus future profits.