Exam 13: Aggregate Demand and Aggregate Supply Analysis

All of the following are reasons why the wages of workers and the prices of inputs rise more slowly than the prices of final goods and services except

An increase in aggregate demand in the economy will have what effect on macroeconomic equilibrium in the long run?

The recession of 2007-2009 made many consumers pessimistic about their future incomes.How does this increased pessimism affect the aggregate demand curve?

The level of real GDP in the long run is

How do changes in income tax policies affect aggregate demand?

Figure 13-1 -Refer to Figure 13-1.Ceteris paribus,an increase in the value of the domestic currency relative to foreign currencies would be represented by a movement from

The short-run aggregate supply curve has a

Explain how the aggregate demand and aggregate supply model can be made more dynamic.

What does the phrase "Keynesian revolution" refer to?

Which of the following best describes the "interest rate effect"?

If potential GDP is equal to $600 billion,what does the long-run aggregate supply curve look like?

An increase in disposable income will shift the aggregate demand curve to the right.

An increase in investment causes the price level to ________ in the short run and ________ in the long run.

The ________ curve has a positive slope because as prices of final goods and services rise,prices of inputs rise more slowly.

What is a supply shock,and why might a supply shock lead to stagflation?

There has been a decrease in investment.As a result,real GDP will ________ in the short run,and ________ in the long run.

Figure 13-2 -Refer to Figure 13-2.Ceteris paribus,a decrease in the expected future price level would be represented by a movement from

Which of the following could explain why there is an increase in potential GDP but the equilibrium level of GDP does not rise?

Explain how "menu costs" affect the slope of the short-run aggregate supply curve.

Hurricane Katrina destroyed oil and natural gas refining capacity in the Gulf of Mexico which subsequently drove up natural gas,gasoline,and heating oil prices.Three years later,once the refining capacity was restored,these prices came back down.The restoration of refining capacity should