The aggregate demand curve identifies the level of aggregate production correspo

Question

The aggregate demand curve identifies the level of aggregate production corresponding to a change in the price level
A) True
B) False
14.
The AD curve shifts rightward when taxes decrease
A) True
B) False
15.
A negative demand shock would lead to a decline in both the price level and output in the short run
A) True
B) False
16.
If output is greater than the full-employment level of output, we can expect wages to rise over time
A) True
B) False
17.
An increase in oil prices in considered a supply shock because it would cause a shift in the aggregate supply curve
A) True
B) False
18.
A positive supply shock causes stagflation in the short run
A) True
B) False

Explanation / Answer

The aggregate demand curve identifies the level of aggregate production corresponding to a change in the price level

B) False
14.
The AD curve shifts rightward when taxes decrease
A) True
B) False
15.
A negative demand shock would lead to a decline in both the price level and output in the short run
A) True
B) False
16.
If output is greater than the full-employment level of output, we can expect wages to rise over time
A) True
B) False
17.
An increase in oil prices in considered a supply shock because it would cause a shift in the aggregate supply curve
A) True
B) False
18.
A positive supply shock causes stagflation in the short run
A) True
B) False

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