The theory ot long-run \'self-adjustment was proposed by the_______Keynesians Cl
ID: 1200893 • Letter: T
Question
The theory ot long-run 'self-adjustment was proposed by the_______Keynesians Classicals The Keynesians and Classicals disagreed on what? the very existence of business cycles the way the economy worked and how to solve macro economic problems whether or not recessions and depressions occurred The short-run aggregate supply curve is positively sloped because: wages and other costs of production respond immediately to changes in prices. profit is lower when prices increase, so output decreases. workers arc willing to work for lower wages rather than be laid off. higher prices lead to higher profit and higher output. A decrease in energy prices will: increase short-run aggregate supply. decrease the quantity of aggregate output supplied in the short run decrease aggregate demand. increase the quantity of aggregate output demanded A natural disaster that destroys part of a country's infrastructure is a typejof. and therefore shifts the_______to the______. negative demand shock: aggregate demand curve: right negative supply shock: aggregate demand curse: lett negative supply shock: short-run aggregate supply curve: left negative demand shock: long-nm aggregate supply curve: leftExplanation / Answer
(1)
The theory of long-run ‘self-adjustment’ was proposed by the Keynesians. The theory shows the expenditure, inflation and results of output in an economy. The correct answer is option (A).
(2)
The Keynesians and Classicals disagreed on the way the economy worked and how to solve macro economic problems. The former believed in aggregate demand affected by private firms and government agencies. The correct answer is option (B).
(3)
The short-run aggregate supply curve is positively sloped because higher prices lead to higher profit and higher output. The increase in the demand of produc leads to increase in the supply of the same which shows rise in revenues. The correct answer is option (D).
(4)
A decrease in energy prices will increase short-run supply. It reduces expenditure of the firm. The correct answer is option (A).
(5)
A natural disaster that destroys part of a country’s infrastructure is a type of negative supply shock and therefore shifts the short-run aggregate supply curve to the left.
The correct answer is option (C).
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