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The long-run aggregate supply curve is vertical because a potential GDP is independent of the price level
In Long run changes in the price level do not affect potential GDP, as potential GDP depends on the size of the labor force, capital stock, and technology.
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The long-run aggregate supply curve is vertical because Select one: a. potential GDP is independent of...
A vertical long-run aggregate supply curve indicates that an increase in the price level will not...
A vertical long-run aggregate supply curve indicates that an increase in the price level will not expand an economy's output capacity in the long run. outputs greater than the long-run supply constraint cannot be achieved. an increase in the price level will permit the economy to achieve a higher level of output. an increase in the price level will promote technological change and more rapid economic growth.
The shape of the long-run aggregate supply curve suggests that
The shape of the long-run aggregate supply curve suggests that Potential GDP is the amount of output that can be produced if the economy is operating at maximum capacity Potential GDP is independent of the average price level Potential GDP is positively related to the average price level Potential GDP is negatively related to the average price level
The Long-Run Aggregate Supply Curve: is vertical at the physical limit of the economy. is upward...
The Long-Run Aggregate Supply Curve: is vertical at the physical limit of the economy. is upward sloping. is horizontal. is vertical at potential GDP
6. Why the aggregate supply curve slopes upward in the short run In the short run,...
6. Why the aggregate supply curve slopes upward in the short run In the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price level in the economy deviates from the expected price level. Several theories explain how this might happen. For example, the misperceptions theory asserts that changes in the price level can temporarily mislead firms about what is happening to their output prices. Consider a soybean farmer who expects a...
When the aggregate demand curve and the short-run aggregate supply curve intersect, a) the long-run aggregate...
When the aggregate demand curve and the short-run aggregate supply curve intersect, a) the long-run aggregate supply curve must also intersect at the same point. Ob) the economy must experience higher output than the natural level of output. o c) the economy must experience lower output than the natural level of output. o d) the economy is in short-run macroeconomic equilibrium. In a small economy in 2016, aggregate expenditure was $900 million while GDP that year was $750 million. Which...
5. Why the aggregate supply curve slopes upward in the short run In the short run,...
5. Why the aggregate supply curve slopes upward in the short run In the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price level in the economy deviates from the expected price level. Several theories explain how this might happen. For example, the misperceptions theory asserts that changes in the price level can temporarily mislead firms about what is happening to their output prices. Consider a soybean farmer...
What does the vertical slope of the long-run aggregate supply curve mean? no matter what the...
What does the vertical slope of the long-run aggregate supply curve mean? no matter what the Real GDP, the price level is always the same Real GDP always increases and never falls Real GDP always converges to the same value in the long run The price level is not a factor determining long-run aggregate supply
1. Aggregate supply definitions The short-run aggregate supply curve shows: What happens to output in an...
1. Aggregate supply definitions The short-run aggregate supply curve shows: What happens to output in an economy when the government spends more money How firms respond to changes in interest rates Changes in output in an economy as the price level changes, holding all other determinants of real GDP constar The relationship between the price level and aggregate expenditure Which of the following are assumed to remain unchanged along a given short-run aggregate supply curve? Check all that The price...
Describe the short-run aggregate supply (SRAS) curve and the long-run aggregate supply (LRAS) curve. A. the...
Describe the short-run aggregate supply (SRAS) curve and the long-run aggregate supply (LRAS) curve. A. the SRAS curve is horizontal and the LRAS curve is upward sloping B. the SRAS curve is horizontal and the LRAS curve is vertical C. the SRAS curve is vertical and the LRAS curve is horizontal D. the SRAS curve is vertical and the LRAS curve is upward sloping Why is the short-run aggregate supply curve horizontal? A. because output is fixed in the short...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
The Long-Run Aggregate Supply Curve: is vertical at the physical limit of the economy. is upward sloping. is horizontal. is vertical at potential GDP
When the aggregate demand curve and the short-run aggregate supply curve intersect, a) the long-run aggregate supply curve must also intersect at the same point. Ob) the economy must experience higher output than the natural level of output. o c) the economy must experience lower output than the natural level of output. o d) the economy is in short-run macroeconomic equilibrium. In a small economy in 2016, aggregate expenditure was $900 million while GDP that year was $750 million. Which...
5. Why the aggregate supply curve slopes upward in the short run In the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price level in the economy deviates from the expected price level. Several theories explain how this might happen. For example, the misperceptions theory asserts that changes in the price level can temporarily mislead firms about what is happening to their output prices. Consider a soybean farmer...
1. Aggregate supply definitions The short-run aggregate supply curve shows: What happens to output in an economy when the government spends more money How firms respond to changes in interest rates Changes in output in an economy as the price level changes, holding all other determinants of real GDP constar The relationship between the price level and aggregate expenditure Which of the following are assumed to remain unchanged along a given short-run aggregate supply curve? Check all that The price...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
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