Question : 51) An economy may not quickly and automatically eliminate a : 1384410

 

51) An economy may not quickly and automatically eliminate a recessionary output gap because wages

A) never change in response to changes in the demand for labour.

B) have a tendency to be sticky downward.

C) have a tendency to fall too quickly.

D) have a tendency to rise too quickly.

E) are flexible but prices have a tendency to be sticky downward.

52) An adjustment “asymmetry” in aggregate supply is

A) the concave shape of the AS curve.

B) the convex shape of the AS curve.

C) the difference in speed of a rightward shift versus a leftward shift (when wages adjust to output gaps).

D) the difference in speed of increases in factor prices versus wage rates.

E) the difference in speed of decreases in output levels.

53) Consider the AD/AS macro model. A permanent demand shock that causes equilibrium output to rise above potential output will

A) allow a stable expansion of real income over time.

B) always reverse itself.

C) be negated in the long run, through the economy’s adjustment process.

D) result in a price level lower than that preceding the demand shock.

E) set off an endless cycle of price rises and increases in unemployment.

54) Consider an AD/AS model in long-run equilibrium. An output gap, caused by a leftward shift of the AD curve, will be eliminated if

A) wages rise quickly.

B) the AS curve shifts upward.

C) wages and other factor prices fall sufficiently.

D) real national income decreases.

E) prices rise quickly.

55) Consider an economy with a relatively steep AS curve. If there is a shift to the right in the AD curve, there will be a ________ in the price level and ________ in national output.

A) small increase; a large increase

B) small increase; a large decrease

C) large increase; a small increase

D) large increase; a small decrease

E) large increase; no change

56) Consider an economy with a relatively steep AS curve. If the AD curve shifts to the left, then the price level will ________ and national output will ________.

A) increase slightly; significantly increase

B) increase slightly; significantly decrease

C) increase sharply; increase slightly

D) fall sharply; will not change.

E) fall sharply; decrease slightly.

57) Suppose Canada’s economy is in a long-run equilibrium with real GDP equal to potential output. Now suppose there is an increase in world demand for Canada’s goods. In the short run, ________. In the long run, ________.

A) real GDP and the price level both fall; real GDP is below its original level with a lower price level

B) real GDP and the price level both rise; real GDP is above its original level with a higher price level

C) real GDP and the price level both rise; real GDP returns to its original level with a higher price level

D) real GDP rises and the price level falls; real GDP returns to its original level with a lower price level

E) real GDP falls and the price level rises; real GDP is below its original level with a higher price level

58) Suppose Canada’s economy is in a long-run equilibrium with real GDP equal to potential output. Now suppose there is an unexpected and sharp reduction in desired business investment expenditure. In the short run, ________. In the long run, ________.

A) real GDP and the price level both fall; real GDP is at its original level with a lower price level

B) real GDP and the price level both fall; real GDP is above its original level with a higher price level

C) real GDP and the price level both rise; real GDP returns to its original level with a higher price level

D) real GDP rises and the price level falls; real GDP returns to its original level with a lower price level

E) real GDP falls and the price level rises; real GDP is below its original level with a higher price level

59) Consider the basic AD/AS macro model in long-run equilibrium. An expansionary AD shock will ________ the price level and ________ output in the short run. In the long run, the price level will ________ and output will ________.

A) decrease; decrease; decrease further; decrease further

B) decrease; decrease; decrease further; be restored to potential output

C) increase; decrease; increase further; increase further

D) increase; decrease; increase further; be restored to potential output

E) increase; increase; increase further; be restored to potential output

60) Consider the basic AD/AS macro model in long-run equilibrium. An expansionary AD shock would have ________ output effect in the short run and ________ output effect in the long run.

A) a positive; no

B) a positive; a positive

C) no; a positive

D) no; no

E) not enough information to know

 

 

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more