Exam 8: Aggregate Demand, aggregate Supply, and the Great Depression

If,other things constant,the actual real wage is below the equilibrium real wage,the short-run aggregate supply curve in the next period would

Suppose the aggregate demand curve shifts rightward against a horizontal short-run aggregate supply curve.Real GDP would ________ while the price level ________.

A doubling of the nominal money supply would create a new AD curve at double the vertical position of the original AD curve because

Figure 7-4 -According to the classical economists when aggregate demand declines,AD₀ to AD₁ in the figure above,and output,falls below the natural rate of unemployment at 3000,wages and prices would

With a falling price level,we move ________ along the demand for labor curve and thus trace ________ along the short-run aggregate supply curve.

If the marginal leakage rate is small,then the AD is

Which of the following groups was NOT affected by the redistribution effect?

Most classical macroeconomists considered unemployment

When the price firms receive for their output rises,the resulting ________ in the real wage rate leads firms to profitably employ ________ labor than before,thus ________ the amount of output willingly supplied.

With a fixed nominal wage the SAS curve is positively sloped because

With the nominal wage rate given,an increase in the price level leads to

A fall in the price level causes

If firms hire workers until the real wage,W/P,is equal to the marginal product of labor,MPN,then the firm

The Pigou effect might be ineffective in correcting a recession if

Pigou's explanation of the existence of unemployment required

An increase in the nominal money supply will shift

The 1933 real GDP per person had fallen to ________ of the 1929 value in the United States,to ________ in Germany,and to ________ in the U.K.and Japan.

Consider an initial IS-LM equilibrium point which corresponds to a point labeled "A" on the current AD curve. -Refer to the information above.If the nominal money supply falls by 4 percent,accompanied by a 4 percent fall in the price level,the resulting IS-LM equilibrium corresponds to a point in the AD diagram

The LM curve will shift to the

If the interest responsiveness of business firms investment is great then the