Explain why the long-run aggregate supply curve is vertical.
What will be an ideal response?
In the long run, the economy operates at full employment, and changes in the price level do not affect employment. Because the level of full-employment output does not depend on the price level, long-run aggregate supply is unaffected by the price level, and so is vertical.
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A depreciation of the dollar causes
A) a decrease in U.S. exports. B) an increase in U.S. imports. C) an increase in the prices of U.S. imports. D) an increase in the prices of U.S. exports.
In the Temporary Assistance for Needy Families program, most families
a. must have both parents in the home to qualify. b. are female head-of-household families in which the father is absent. c. have adult children with disabilities living at home. d. are ineligible to receive assistance from other support programs.
Advertisers currently spend about $100 million per year to change the demand for products.
Answer the following statement true (T) or false (F)
If external benefits are taken into account in the market
A) the demand curve would shift to the left. B) the supply curve would shift to the left. C) the demand curve would shift to the right. D) the supply curve would become vertical.