Exam 33: Aggregate Demand and Aggregate Supply

Optimism Imagine that the economy is in long-run equilibrium. Then, perhaps because of improved international relations and increased confidence in policy makers, people become more optimistic about the future and stay this way for some time. -Refer to Pessimism.Which curve shifts and in which direction?

Which of the following adjust to bring aggregate supply and demand into balance?

Which of the following shifts aggregate demand to the right?

Which of the following is not included in aggregate demand?

The long-run aggregate supply curve shifts right if

Which of the following shifts short-run aggregate supply right?

In the mid-1970s the price of oil rose dramatically.This

Other things the same,when the government spends more,the initial effect is that

Which of the following typically rises during a recession?

Other things the same,when the price level rises,interest rates

Technological progress shifts the long-run aggregate supply curve to the right.

Which of the following shifts short-run aggregate supply left?

Tax cuts shift aggregate demand

In the long run,technological progress

An increase in the money supply

Which of the following would increase the price level?

The exchange-rate effect is the idea that a higher U.S.price level causes the value of the dollar to increase in foreign exchange markets,and this effect contributes to the downward slope of the aggregate-demand curve.

The sticky-price theory of the short-run aggregate supply curve says that if the price level rises by 5% and people were expecting it to rise by 2%,then firms have

Other things the same,if prices fell when firms and workers were expecting them to rise,then

In the last half of 1999,the U.S.unemployment rate was about 4 percent.Historical experience suggests that this is