Exam 14: Aggregate Demand and Supply

When prices rise, consumers and businesses hold larger money balances. This reduces the supply of loanable funds, increases the interest rate, and discourages both consumption and investment. This process is called the:

In the aggregate demand/aggregate supply model, a country's full-employment real GDP is represented by:

Along the short-run aggregate supply curve (SRAS), an increase (rightward shift) in the aggregate demand curve will increase:

Other things constant, an increase in resource prices will:

Which of the following will most likely increase aggregate demand?

In the short run, an increase in the price level causes:

The vertical portion of the aggregate supply curve shows that at full employment an increase in the price level will:

Which of the following could not be expected to shift the aggregate demand curve?

When moving along a market demand curve, the prices of related goods are assumed to be constant. With an aggregate demand curve,

Exhibit 14-1 Aggregate supply curve In Exhibit 14-1, higher price levels allow producers to earn higher profits, stimulating production and employment in:

Suppose the price level falls. The result is that the:

For an economy, aggregate demand equals:

Exhibit 14-2 Aggregate supply and demand curves In Exhibit 14-2, the change in equilibrium from E₁ to E₂ represents:

Which of the following events is the most likely to create stagflation?

Which of the following will most likely cause an increase in the aggregate supply curve?

Along the Keynesian range of the aggregate supply curve, an increase in the aggregate demand curve will increase:

In the intermediate range of the aggregate supply curve, higher aggregate demand will increase:

Which of the following would shift the aggregate demand curve to the left?

The short-run aggregate supply curve (SRAS) is the amount of real GDP:  

  Macro AD-AS Model In Exhibit 14A-4, the level of real GDP represented by Y _p :