Question :
71) A rightward shift in the economy’s AS curve implies : 1384398
71) A rightward shift in the economy’s AS curve implies that
A) at any given price level, a lower level of output will be supplied.
B) at any given price level, a higher level of output will be supplied.
C) there is a decrease in aggregate supply.
D) there is a demand shock.
E) the same output will be produced, but only at a higher price level.
Answer: B
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Applied
User2: Qualitative
72) A leftward shift in the economy’s AS curve implies that
A) at any given price level, a lower level of output will be supplied.
B) at any given price level, a higher level of output will be supplied.
C) there is an increase in aggregate supply.
D) there is a demand shock.
E) the same output will be produced in equilibrium, but at a lower price level.
Answer: A
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Applied
User2: Qualitative
73) The economy’s AS curve is often assumed to be relatively flat at low levels of real GDP. The underlying reasoning is that
A) consumer demand for most goods tends to be non-responsive to price when output is low.
B) consumer demand for most goods tends to be very responsive to price when output is low.
C) at low levels of output, firms are faced with unused capacity and thus can increase output without significantly increasing their costs.
D) the price level is constant.
E) profits are normally high in this section of the AS curve, so firms are willing to expand output.
Answer: C
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Recall
Objective: REVISED
User2: Qualitative
74) Consider the economy’s aggregate supply curve. Other things being equal, unit costs will tend to increase if
A) there is a rise in the price of oil.
B) the government reduces payroll taxes.
C) wage increases exceed productivity increases.
D) wages rise.
E) wage and price controls are in effect.
Answer: C
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Recall
Objective: REVISED
User2: Qualitative
75) Consider the economy’s aggregate supply curve. Other things being equal, unit costs will tend to fall if
A) there is a fall in the price of oil.
B) the government increases payroll taxes.
C) wage increases are less than productivity increases.
D) wages fall.
E) wage and price controls are in effect.
Answer: C
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Recall
Objective: REVISED
User2: Qualitative
76) Consider the basic AD/AS model. When wage rates rise faster than the increase in labour productivity, the
A) AD curve shifts left.
B) AS curve shifts upward.
C) output gap falls.
D) output gap increases.
E) AS curve shifts downward.
Answer: B
Comment: An algorithmic version of this question appears in MyEconLab
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Applied
Objective: REVISED
User2: Qualitative
77) Suppose there is a drop in the price of an important factor input. What will be the effect on the aggregate supply curve?
A) There will be movement to the left, along the AS curve.
B) The AS curve will shift to the left.
C) There will be movement to the right, along the AS curve.
D) The AS curve will shift to the right.
E) There will be no change in the AS curve.
Answer: D
Diff: 1
Topic: 23.2. slope and shifts of the AS curve
Skill: Recall
User2: Qualitative
78) Consider the basic AD/AS model. Suppose that a rising percentage of high-school graduates are illiterate, resulting in a decrease in average labour productivity. This change will
A) shift the AD curve to the left.
B) shift the AD curve to the right.
C) shift the AS curve to the left.
D) shift the AS curve to the right.
E) cause a movement to the right along the AS curve.
Answer: C
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Applied
User2: Qualitative
79) Consider the basic AD/AS model. Suppose that high-school graduates have better computing skills than did graduates in the past, resulting in an increase in average labour productivity. This change will
A) shift the AS curve to the left.
B) shift the AS curve to the right.
C) shift the AD curve to the left.
D) shift the AD curve to the right.
E) cause a movement along the AS curve to the right.
Answer: B
Diff: 2
Topic: 23.2. slope and shifts of the AS curve
Skill: Applied
User2: Qualitative
80) Consider the basic AD/AS model. If their unit costs rise as output increases, price-taking firms will be prepared to produce ________ only if ________.
A) more; prices decrease
B) more; the economy is in equilibrium
C) their current output; prices increase
D) less; prices increase
E) more; prices increase
Answer: E
Diff: 1
Topic: 23.2. slope and shifts of the AS curve
Skill: Recall
User2: Qualitative
