Question 2 For any given expected inflation rate, short-run aggregate supply cur

Question

Question 2

For any given expected inflation rate, short-run aggregate supply curves show the relationship between

the money supply and growth rate of output.

inflation and growth rate of output.

production factors and wages.

inflation and wages.

1 points   

Question 3

Why is the SRAS curve steeper above its intersection with the Solow growth curve?

Wages are stickier in the upward direction.

Wages are less sticky in the upward direction.

Lower inflation will lead to faster growth.

Employees become less motivated to work during times of unexpected inflation.

1 points   

Question 4

What factors triggered the Great Depression?

decreased consumer spending and tight monetary policy

decreased investment and increased inflation

decreased employment and increased money supply

decreased inflation and increased income taxes

1 points   

Question 5

How might changes in the money supply be non-neutral in the short run?

As the amount of money circulating in the economy changes before prices respond, consumers' purchases change accordingly, which leads producers to change production levels.

When money supply changes in the short run, it will affect nominal, but not real, variables in the short run.

As money growth increases at a faster rate, it will cause real GDP to grow at an equally faster rate.

If producers expect inflation to increase, they will increase supply in order to sell before the arrival of inflation.

1 points   

Question 6

For a given nominal interest rate, an increase in deflation will cause the real rate of interest to

remain relatively constant.

increase.

decrease.

become unpredictable.

Question 8

Which of the three price indexes measures the average price level of the largest total number of goods?

the consumer price index

the GDP deflator

the producer price index

Each price index accomplishes the same task.

The textbook uses the

the money supply and growth rate of output.

inflation and growth rate of output.

production factors and wages.

inflation and wages.

Explanation / Answer

1. For any given expected inflation rate, short-run aggregate supply curves show the relationship between

inflation and growth rate of output.

2. Why is the SRAS curve steeper above its intersection with the Solow growth curve?

Wages are less sticky in the upward direction.

3. What factors triggered the Great Depression?

decreased investment and increased inflation

4. How might changes in the money supply be non-neutral in the short run?

As the amount of money circulating in the economy changes before prices respond, consumers' purchases change accordingly, which leads producers to change production levels.

5. For a given nominal interest rate, an increase in deflation will cause the real rate of interest to

increase

6. Which of the three price indexes measures the average price level of the largest total number of goods?

Each price index accomplishes the same task

7. The textbook uses the

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.