Mod 18 Quiz

The short-run aggregate supply curve may shift to the right if:

• productivity increases.

• nominal wages increase.

• personal income taxes decrease.

• commodity prices rise.

• government spending increases.

Which of the following would cause a shift in the short-run aggregate supply curve?

• A change in the quantity of real output supplied.

• A change in the price level.

• A change in commodity prices.

• Changes in aggregate demand.

• Changes to government transfer payments..

A decrease in energy prices will:

• increase aggregate demand.

• decrease the quantity of aggregate output supplied in the short run.

• decrease aggregate demand.

• increase the quantity of aggregate output demanded.

• increase short-run aggregate supply.

Nominal wages are described as “sticky” because:

• in the short run these payments are slow to rise when there are labor shortages and slow to fall even when there is significant level of unemployment.

• in the long run these payments remain fixed thereby increasing the profitability of the firms.

• in the short run these payments are slow to fall when there are labor shortages and slow to rise even when there is significant level of unemployment.

• in the long run all wages become adjusted for inflation.

• workers will never ask for increases to their wages.

In the long run, wages and prices are considered to be:

• sticky.

• constant.

• flexible.

• irrelevant.

• recessionary.