Exam 12: Part B: Aggregate Demand and Aggregate Supply

An economy is employing 2 units of capital, 5 units of raw materials, and 8 units of labour to produce its total output of 640 units.Each unit of capital costs $10, each unit of raw materials, $4, and each unit of labour, $3.Refer to the above information.The per unit cost of production in this economy is:

Refer to the diagram given below. If aggregate supply shifts from AS₁ to AS₃, then the real domestic output will:

A change in the price level products a?

Which of the above diagrams best portrays the effects of a decrease in the availability of key natural resources?

The following aggregate demand and aggregate supply schedules are for a hypothetical economy. Refer to the data above.The vertical range of the aggregate supply curve is associated with price levels:

Suppose the full-employment level of real output (Q) for a hypothetical economy is $500 and that the price level (P) initially is 100.Use the following short-run aggregate supply schedules to answer the next question. Refer to the information above.If the price level unexpectedly declines from 100 to 75, the level of real output in the short run will:

The long run aggregate supply:

The aggregate demand curve:

The following aggregate demand and supply schedules are for a hypothetical economy: Refer to the above data.The equilibrium price level will be:

Refer to the diagram below. Which of the following would shift the aggregate demand curve from AD₂ to AD₁?

When deriving the aggregate demand (AD) curve from the aggregate expenditure model, an increase in Canadian product prices would cause:

Other things equal, an improvement in productivity will:

Menu costs will:

A change in aggregate supply would be caused by a change in:

The relationship between the price level and the amount of real GDP is:

An increase in household borrowing for consumption will:

In the short run, the aggregate supply curve of an economy is:

The real-balances effect indicates that:

Which of the above diagrams best portrays the effects of an increase in productivity?

The interest-rate effect is one of the determinants of aggregate demand.