Essay
Suppose the economy is initially in long-run equilibrium.For each of the shocks listed below,explain the long-run effects on output and the price level.
a.Labour supply decreases.
b.Productivity increases.
Correct Answer:
Verified
a.Output declines an...View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Correct Answer:
Verified
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Q14: The aggregate demand curve shows<br>A)the demand for
Q89: A temporary adverse supply shock directly causes<br>A)a
Q90: When the money supply declines by 10%,in
Q91: A decrease in the effective tax rate
Q92: The IS curve would unambiguously shift up
Q93: Which of the following would shift the
Q95: Suppose that the following IS-LM model represents
Q96: Suppose the intersection of the IS and
Q98: The full-employment (FE)line shifts left if<br>A)labour supply
Q99: Which of the following would shift the