Exam 11: Classical and Keynesian Macro Analyses

The short-run aggregate supply curve is horizontal if

A reduction in nominal wages will cause which of the following?

-Refer to the above figure. If the aggregate demand curve shifts beyond AD₅, which of the following would we NOT expect?

What is true of the aggregate supply curve in the classical model?

-In the above figure, the inflationary gap can correctly be identified as

Keynes argued that because of sticky prices and wages,

The classical economists argued that planned saving and planned investment will always be equal because of changes in

Saving is not a problem in the classical model because

Consider a nation in which most workers are unionized. If all the nation's unions band together and succeed in boosting wages established by long-term labor contracts, then

Which one of the following statements is true?

In the classical model,

The classical model makes little distinction between the long run and short run because

In an economy with no government and no international trade, consumption expenditures will be less than the total value of goods and services when

The short-run aggregate supply curve is horizontal when

With respect to unemployment, the classical model states that

Using a graph, analyze the Great Depression from a Keynesian perspective. What happened to unemployment?

In the classical model, an increase in the unemployment rate

All of the following were classical economists EXCEPT

The implication of Say's law is that

The short-run aggregate supply curve in modern Keynesian analysis