Exam 13: The Aggregate Demandaggregate Supply Model

Suppose a prolonged war in a country destroys 30 percent of the capital stock. In the long run, the price level will ____as_____ .

Unemployment rises and real gross domestic product GDP) growth slows during the_____ business cycle.

________would cause a leftward shift of the aggregate demand curve.

During the latter part of the 1990s, firms purchased new computer systems so that they could establish web sites and eventually online ordering systems. How is this likely to impact the aggregate demand curve and the loanable funds market?

The aggregate demand curve is best represented by which of the following equations?

The wealth effect is best described as resulting from a(n)

When a change in the price level leads to a change in saving, this is known as the_______ effect.

What is the difference between a movement along the aggregate demand curve and a shift of the aggregate demand curve? Explain in terms of what causes a movement and what causes a shift.

Refer to the following figure to answer the next questions. -Based on the figure, an increase in_____ could cause the economy to move from point A to point D.

Which of the following would cause an upward movement along the aggregate demand curve?

If the current short-run equilibrium level of output is greater than full-employment output, we can then expect that in the long run the

The slope of the short-run aggregate supply curve can be explained by

A rightward shift of the long-run aggregate supply curve means there has been

The long-run aggregate supply curve is

______would decrease short-run aggregate supply.

A new government program reduces the cost of a college education at public universities by 50 percent. In the long run, this can be expected to____ long-run aggregate supply and _________aggregate demand.

New computer technologies can be expected to

When decision makers have time to fully adjust to changes in the overall price level, we refer to this as

Suppose advances in computer technology lead to a surge in worker productivity. In the long run, output will ______and the price level will_______ .

If the price level falls but workers are reluctant to accept a pay cut, this is an example of