The upward slope of the short-run aggregate supply curve is based on the assumption that:
A. nominal wages are greater than real wages.
B. nominal wages are less than real wages.
C. nominal wages and other resource costs do respond to price level changes.
D. nominal wages and other resource costs do not respond to price level changes.
Answer: D
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What is the difference between a public franchise and a public enterprise?
A) Both refer to a service provided directly to consumers through the government, but "public franchise" is a term more commonly used in the United States while "public enterprise" is more commonly used in European countries. B) A public franchise grants a firm the right to be the sole legal provider of a good or service. A public enterprise refers to a service that is provided directly to consumers through the government. C) A public enterprise is owned by the public through its holdings of shares of stock in the enterprise. A public franchise is a firm owned by the government. D) A public enterprise grants a firm the right to be the sole legal provider of a good or service. A public franchise refers to a service that is provided directly to consumers through the government.
In the long-run, an increase in the budget deficit and an expansionary monetary policy would:
A) increase the price level only. B) increase both the price level and real income. C) increase real income only. D) none of the above.
Sally is allocating her budget between two goods, A and B. If Sally has used up the budget on a combination of A and B for which MUA/PA exceeds MUB/PB, she can increase total utility by buying
a. more A and less B b. more B and less A c. more A without changing her consumption of B d. less B without changing her consumption of A e. more B and more A
Improvements in the level of technology will generally shift the production function downward
a. True b. False Indicate whether the statement is true or false