(11) How does an increase in the money supply affect total output? Output increa
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Question
(11) How does an increase in the money supply affect total output? Output increases, because interest rates fall. Output increases, because interest rates rise. Aggregate demand increases, but total output falls. Aggregate demand falls, but total output rises.
(12) Which policy variables can affect aggregate demand? Government spending, taxes, and the money supply Consumer spending, business spending, and net exports Consumer savings, business spending, and net exports Consumer confidence, business confidence, and foreign confidence in the domestic economy
(13) The short-run aggregate supply curve illustrates how output responds to changes in prices before all prices have adjusted. how output responds to changes in prices after all prices have adjusted. how producers raise prices in response to increases in their costs. how consumers reduce spending in response to increases in prices.
(14) When prices rise, but wages remain fixed in the short run firms face profit opportunities, because real wages fall. firms reduce output, because the costs of their inputs increase. firms' profits decline, because they are unable to attract workers at the old wage. firms' profits remain unchanged, because in the long run wages will rise to catch up with the increase in prices.
(15) What is the relationship between the price level and the level of output in the long run? When the price level rises, output increases. When the price level rises, output decreases. The relationship depends on how quickly producers respond to changes in prices. There is no relationship between the price level and the level of output.
(16) What is the main reason why wages might be fixed in the short run? Workers are afraid they may be fired if they ask for raises. Unions are not constantly renegotiating their wage contracts. Unions are constantly renegotiating their wage contracts. Workers fail to recognize that prices have risen.
(17) If inflation is __________ than expected, the real wages of workers covered by wage contracts fall.
(18) In the short run, what happens to the level of output when the government increases its spending? Aggregate demand shifts outward, decreasing the equilibrium level of output. Aggregate demand shifts inward, decreasing the equilibrium level of output. Aggregate demand shifts outward, increasing the equilibrium level of output. Aggregate demand shifts inward, increasing the equilibrium level of output.
(19) What is the long-run effect of increasing output beyond the full-employment level? Prices and wages rise, and the level of output falls. Prices and wages rise, and the level of output remains unchanged. Prices, wages, and the level of output increase. Prices, wages, and the level of output decrease.
(20) What is the effect of a tax increase on the equilibrium level of aggregate output and prices in the economy? Both the level of output and the price level increase. Both the level of output and the price level decrease. The level of output decreases and the price level increases. The level of output increases and the price level decreases.
(21) The natural rate of unemployment is fixed at about 3 percent. the rate of unemployment that guarantees that most people who want to work have jobs. the rate of unemployment associated with the highest possible level of output in the economy. the rate of unemployment associated with a stable rate of inflation.
(22) Which of the following statements best describes the relationship between unemployment and inflation? The higher the rate of inflation, the higher the rate of unemployment. The higher the rate of inflation, the lower the rate of unemployment. When inflation rises, unemployment first rises and then falls. There is no relationship between unemployment and inflation.
(23) If the Federal Reserve increases the money supply too rapidly, then prices rise. prices fall. unemployment rises. unemployment falls.
(24) ____________ expectations cause the long-run adjustment process to lag.
(25) Examine the graph below. This economy is
suffering the effects of a supply shock. producing beyond its full-employment level of output. benefiting from an increased pool of resources. experiencing high unemployment.
Explanation / Answer
11) The answer is A -) Output increases, because interest rates fall.
because, when the money supply increases , the banks has more money to lend and therefore they want to lend more and more and attrach borrowers by lowering interest rates . this would result in the decrease in the interest rate or interest rate fall , and result in the increase in the aggregate demand which drives up the output. or ouptut increase.
12) The answer is A -) Government spending, taxes, and the money supply
because, government spending , taxes and the money supply are ate monetary and fiscal policy whcih affects the aggregate demand in the ecocnomy .
13) Please uplaod it againt, it against chegg policy, the chegg policy is answer only 1 question at one time
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