ECON 1010 Study Guide - Business Cycle, Human Capital, Disposable And Discretionary Income

245 views25 pages
3 Feb 2013
Department
Course
Professor

For unlimited access to Study Guides, a Grade+ subscription is required.

University of Lethbridge
Department of Economics
ECON 1012
Introduction to Macroeconomics
Instructor: Michael G. Lanyi
CH 26 AD & AS
Use the figure below to answer the following questions.
Figure 26.1.1
1)
Refer to Figure 26.1.1.
Which graph illustrates what happens when factor prices decrease?
A)
(a)
B)
C)
(c)
D)
(d)
E)
(a) and (b)
Topic:
Aggregate Supply
2)
Refer to Figure 26.1.1.
Which graph illustrates what happens when factor prices rise?
A)
(a)
B)
C)
(c)
D)
(d)
E)
(a) and (b)
Topic:
Aggregate Supply
1
Unlock document

This preview shows pages 1-3 of the document.
Unlock all 25 pages and 3 million more documents.

Already have an account? Log in
3)
Which one of the following newspaper quotations describes a movement along an
LAS
curve?
A)
"Growth has been unusually high the last few years due to more women entering the labour force."
B)
"The decrease in consumer spending may lead to a recession."
C)
"The recent tornadoes destroyed many factories in Calgary and Edmonton."
D)
"Recent higher wage settlements are expected to cause higher inflation this year."
E)
"The increase in consumer spending is expected to lead to inflation, without any increase in real GDP."
Topic:
Aggregate Supply
4)
Which one of the following newspaper quotations describes a shift of only the
SAS
curve?
A)
"The increase in consumer spending is expected to lead to inflation, without any increase in real GDP."
B)
"Recent higher wage settlements are expected to cause higher inflation this year."
C)
"Growth has been unusually high the last few years due to more women entering the work force."
D)
"The decrease in consumer spending may lead to a recession."
E)
"The recent tornadoes destroyed many factories in Calgary and Edmonton."
Topic:
Aggregate Supply
5)
Which one of the following newspaper quotations describes a rightward shift of the
LAS
curve?
A)
"The recent tornadoes destroyed many factories in Calgary and Edmonton."
B)
"Recent higher wage settlements are expected to cause higher inflation this year."
C)
"The increase in consumer spending is expected to lead to inflation, without any increase in real GDP."
D)
"Growth has been unusually high the last few years due to more women entering the work force."
E)
"The decrease in consumer spending may lead to a recession."
Topic:
Aggregate Supply
6)
Which one of the following newspaper quotations describes a leftward shift of the
LAS
curve?
A)
"The increase in consumer spending is expected to lead to inflation, without any increase in real GDP."
B)
"The decrease in consumer spending may lead to a recession."
C)
"Recent higher wage settlements are expected to cause higher inflation this year."
D)
"The recent tornadoes destroyed many factories in Calgary and Edmonton."
E)
"Growth has been unusually high the last few years due to more women entering the work force."
Topic:
Aggregate Supply
7)
Which of the following does not change short
-
run
aggregate supply?
A)
A change in the full
-
employment quantity of labour.
B)
A change in expected future profits.
C)
T
echnological change.
D)
A change in the money wage rate.
E)
An increase in the quantity of capital.
Topic:
Aggregate Supply
8)
Complete the following sentence. Potential GDP
A)
does not vary with the price level.
B)
never changes.
C)
increases as the price level rises.
D)
increases as
the quantity of money in the economy increases.
E)
is the level of real GDP when unemployment is zero.
Topic:
Aggregate Supply
9)
A vertical long
-
run aggregate supply curve indicates that
A)
an increase in the price level will permit the economy to achieve a higher level of output.
B)
an increase in the price level will increase technological change and economic growth.
C)
the long
-
run aggregate supply curve never shifts.
D)
output rates greater than the long
-
run output rate are unattainable.
E)
an increase in the price level will not expand an economy's output in the long run.
Topic:
Aggregate Supply
2
Unlock document

This preview shows pages 1-3 of the document.
Unlock all 25 pages and 3 million more documents.

Already have an account? Log in
10)
The long
-
run aggregate supply curve is vertical because
A)
potential GDP is independent of the price level.
B)
potential GDP never changes.
C)
a vertical long
-
run supply curve indicates that an increase in aggregate demand will lead to a larger real GDP,
but not a larger nominal GDP.
D)
actual output can never exceed, even temporarily, the output rate implied by the economy's long
-
run aggregate
supply curve.
E)
a vertical long
-
run aggregate supply curve indicates the maximum output rate that an economy can ever reach.
Topic:
Aggregate Supply
11)
The short
-
run aggregate supply curve indicates
A)
the relationship between the price level and real GDP demanded by consumers, investors, governments, and net
exporters.
B)
the relationship between the price level and the natural unemployment rate.
C)
the relationship between the quantity of real GDP supplied and the price level when the money wage rate, the
prices of other resources, and potential GDP remain constant.
D)
the various quantities of real GDP producers supply at different income levels.
E)
the relationship between the purchasing power of wages and the quantity of labour supplied by households.
Topic:
Aggregate Supply
12)
The long
-
run aggregate supply curve is
A)
negatively sloped.
B)
positively sloped but extremely steep.
C)
almost flat.
D)
positively sloped at low levels of real GDP and vertical at high levels of real GDP.
E)
vertical.
Topic:
Aggregate Supply
13)
The short
-
run aggregate supply curve is the relationship between the quantity of real GDP supplied and
A)
the quantity of real GDP demanded.
B)
the price level.
C)
the real interest rate.
D)
real income.
E)
the inflation rate.
Topic:
Aggregate Supply
14)
Everything
else remaining the same, the short
-
run aggregate supply curve shifts rightward if
A)
the quantity of capital decreases.
B)
aggregate demand increases.
C)
factor prices increase.
D)
the money wage rate increases.
E)
the full
-
employment quantity of labour increases.
Topic:
Aggregate Supply
15)
Which one, if any, of the following events shift the short
-
run aggregate supply curve but not the long
-
run aggregate
supply curve?
A)
A
n increase in the full
-
employment quantity of labour.
B)
A
change in factor prices.
C)
A
change in the quantity of capital.
D)
A
n advance in technology.
E)
None of the above.
Topic:
Aggregate Supply
3
Unlock document

This preview shows pages 1-3 of the document.
Unlock all 25 pages and 3 million more documents.

Already have an account? Log in

Get access

Grade+
$10 USD/m
Billed $120 USD annually
Homework Help
Class Notes
Textbook Notes
40 Verified Answers
Study Guides
1 Booster Class