The primary source of shocks to potential output and long-run supply for real business cycle theorists is ________
A) changes in the money supply
B) a change in the price of complements
C) a change in any of the components of aggregate demand
D) shocks to productivity
D
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Which of the following is a reason for the existence of sticky wages?
A) Cutting wages during an economic downturn is illegal. B) Some wages are set by contract. C) Increasing wages means reduced profits during economic expansions. D) By law, if one worker's wages are changed, all workers' wages must be changed.
For this question, assume that the economy is initially operating at the natural level of output. An increase in unemployment benefits will cause
A) an increase in the real wage in the medium run. B) a reduction in the real wage in the medium run. C) no change in the real wage in the medium run. D) ambiguous effects on the real wage in the medium run.
Suppose that a university decides to spend $1 million to upgrade personal computers and scientific equipment for faculty rather than spend $1 million to expand parking for students. This example illustrates
A. distorted priorities. B. increasing opportunity costs. C. opportunity costs. D. productive efficiency.
Which one of the following is not an example of final goods in national income accounting?
A. Desktop computer purchased by an executive for business use B. Tractor purchased by a construction company C. Lumber and steel beams purchased by a construction company D. Laptop computer purchased by an executive for personal use