The only way to increase the size of the real GDP in the ____________ zone of the SRAS curve is for AS to shift to the right.
a. neoclassical
b. intermediate
c. Keynesian
d. Say
a. neoclassical
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The historical record suggests that
A) the Phillips curve is horizontal. B) once policy makers attempted to exploit a short-run Phillips curve trade-off, it disappeared. C) shifts in long-run aggregate supply do not affect real output. D) inflation rates are lowest when unemployment rates are also low.
Answer the following questions true (T) or false (F)
1. Suppose real GDP is $13 trillion and potential real GDP is $13.5 trillion. If Congress and the president increase government purchases by $500 billion, then the economy will be brought to equilibrium at potential real GDP. 2. In the case of an upward-sloping aggregate supply curve, the change in real GDP brought about by a change in government spending will be less than that predicted by the simple government purchases multiplier. 3. Crowding out refers to a decrease in government purchases as a result of an increase in private expenditures.
The demand for most farm products is relatively inelastic. A drought that reduces the supply of farm products will also cause farm revenues to fall
Indicate whether the statement is true or false
In the long run, all costs are fixed costs
a. True b. False Indicate whether the statement is true or false