Multiple Choice Questions:
1. In the short run, a decrease in the price level?
a. Increases output prices relative to input prices.
b. Increases the profit margins of many producers.
c. Decreases RGDP supplied.
d. Decreases unemployment rates.
e. Does none of the above.
2. Which of the following would shift the long-run aggregate supply curve if it changed?
a. The level of capital in the economy
b. The amount of land in the economy
c. The amount of labor in the economy
d. The technology in the economy
e. Any of the above
3. The short-run aggregate supply curve will shift to the left, other things being equal, if
a. Energy prices fall.
b. Technology and productivity increase in the nation.
c. A short-term increase in input prices occurs.
d. The capital stock of the nation increases.
4. An increase in input prices causes?
a. The short-run aggregate supply curve to shift outward, which means the quantity supplied at any price level declines.
b. The short-run aggregate supply curve to shift inward, which means the quantity supplied at any price level declines.
c. The short-run aggregate supply curve to shift inward, which means the quantity supplied at any price level increases.
d. The short-run aggregate supply curve to shift outward, which means the quantity supplied at any price level increases.
5. How will an increase in money wages affect the short-run aggregate supply curve?
a. It will shift left (a decrease in short-run aggregate supply).
b. It will shift left (an increase in short-run aggregate supply).
c. It will shift right (a decrease in short-run aggregate supply).
d. It will shift right (an increase in short-run aggregate supply).
6. An unusual series of rainstorms washes out the grain crop in the upper plains states, severely curtailing the supply of corn and wheat, as well as soybeans. What effect would this situation have on aggregate supply?
a. It would shift the SRAS left, but not the LRAS.
b. It would shift both the SRAS and the LRAS left.
c. It would shift the SRAS right, but not the LRAS.
d. It would shift both the SRAS and the LRAS right.
7. Any permanent increase in the quantity of any of the factors of production—capital, land, labor, or technology—available will cause
a. The SRAS to shift to the left and LRAS to remain constant.
b. The SRAS to shift to the right and LRAS to remain constant.
c. Both SRAS and LRAS to shift to the right.
d. Both SRAS and LRAS to shift to the left.
8. Which of the following could be expected to shift the short-run aggregate supply curve upward?
a. A rise in the price of oil
b. A natural disaster
c. Wage increases without increases in labor productivity
d. All of the above