Exam 10: Bringing In The Supply Side Unemployment and Inflation

Demand-side changes explain everything about stagflation.

An economic boom that creates an inflationary gap is usually followed later by

When economists refer to the economy's self-correcting mechanism,they are referring to the fact that the

Aggregate supply can be thought of as

An increase in wages will cause the aggregate supply curve to

Profit per unit can be expressed as price - cost per unit.

A recessionary gap exists when

For most firms in the economy,the largest part of factor costs is the cost of

Increases in productivity are caused by

A period of stagflation is the normal aftermath of a period of

If the price level falls,what will happen to the aggregate supply curve?

The aggregate supply curve is

The aggregate supply curve slopes upward because firms

Figure 10-7 -Which of the panels in Figure 10-7 shows an economic expansion caused primarily by a change in aggregate demand?

If the price level rises,what will happen to aggregate supply?

Figure 10-7 -Refer to Figure 10-7.Which of the diagrams in Figure 10-7 represents a decrease in consumer spending combined with a positive supply shock?

Aggregate supply is defined as

A severe hurricane hits Florida,destroying large amounts of the citrus crop.What is the most likely effect of this on aggregate supply?

In our modern economy,the adjustment process necessary to eliminate a recessionary gap is very rapid.

The concept of aggregate supply refers to a