Chapter 14 Aggregate Demand and Aggregate Supply

| November 9, 2018

44)
In the long run, output is determined solely by the supply of capital and the
supply of labor, not the price level.

45)
In the long run, the level of output depends on the price level.

46)
In the short run, the price level is determined primarily by the supply of
goods.

47)
Adverse supply shocks can cause a recession with increasing price level.

48)
The term “stagflation” is used to define an economic situation where
there are adverse supply shocks which cause a fall in output but with
increasing price level.

49)
Explain why the long-run aggregate supply curve is vertical.

50)
Explain why the short-run aggregate supply curve is a relatively flat,
horizontal line.

51)
What are supply shocks? Explain what effect adverse and favorable supply shocks
have on the supply curve.

52)
Name a supply shock that has affected the U.S. economy on more than one
occasion.

14.4 From the Short Run to the Long Run

1)
During an economic boom
A)
actual output exceeds potential output.
B)
potential output exceeds quantity demanded.
C)
potential output exceeds actual output.
D)
aggregate demand exceeds aggregate supply.

Get a 20 % discount on an order above $ 40
Use the following coupon code:
LOBSTER
Positive SSL