Exam 12: Aggregate Demand and Aggregate Supply

Input\nobreakspaceQuantity Real\nobreakspaceDomestic\nobreakspaceOutput 100 200 150 300 200 400 The table gives information about the relationship between input quantities and real domestic output in a hypothetical economy. Suppose that the price of each input increased from $\$ 5$ to $\$ 8$ . The per-unit cost of production in the economy would

The long-run aggregate supply curve is

Collective bargaining agreements that prohibit wage cuts for the duration of the contract contribute to

Deflation refers to a situation where

A negative GDP gap can be caused by either a decrease in aggregate demand or a decrease in aggregate supply.

If productivity increases, then the per-unit production cost decreases.

When the economy is experiencing demand-pull inflation, its real GDP tends to be rising.

When aggregate demand declines, wage rates may be inflexible downward, at least for a time, because of

In the diagram, the economy's relevant aggregate demand and long-run aggregate supply curves, are lines

If the dollar depreciates in value relative to foreign currencies, then aggregate

The aggregate supply curve (short run) becomes steeper as the economy moves rightward and upward along it.

Suppose that nominal wages fall and productivity rises in a particular economy. Other things equal, the aggregate

An increase in personal income taxes would shift AD to the

Which would most likely shift the aggregate supply curve? A change in the prices of

Refer to the diagram. If the aggregate supply curve shifted from AS₀ to AS₁ and the aggregate demand curve remains at AD₀, we could say that