Question 11 (1 point) An increase in the money supply leads to a shift in AD in

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Question 11 (1 point)

An increase in the money supply leads to a shift in AD in the _____ run and AS in the _____ run.

Question 11 options:

short, short

short, long

long, short

long, long

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Question 12 (1 point)

Assuming flexible prices, if the currency depreciates more than anticipated, then equilibrium output should _____ and the equilibrium price level should _____ in the short run.

Question 12 options:

rise, rise

rise, fall

fall, rise

fall, fall

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Question 13 (1 point)

If workers successfully demand higher wages, _____ shifts to the____

Question 13 options:

AD, left.

AD, right.

AS, left.

AS, right.

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Question 14 (1 point)

Which of the following schools of thought believe that prices adjust rapidly (i.e. immediately)

Question 14 options:

classicals

keynsians

new classicals

new keynsians

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Question 15 (1 point)

Which lag affects monetary policy the most?

Question 15 options:

the time to get legislation passed

the time to implement a change in the interest rate

the time it takes for an interest rate change to affect the economy

the time it takes to observe the change in longer term interest rates

short, short

short, long

long, short

long, long

Explanation / Answer

11) AD shift in short run and AS shift in long run. AD depends on money supply
Short,Long
12) Fall,Rise
Because :- Currency depriciates ----> Money Supply increase ----> Inflation ---> Increase in price level
13) AS,right
Reason - AS depends on nominal wage i.e. directly proportional
14) Keynesian school of thought as per defination
15) the time it takes to observe the change in longer term interest rates

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