1. Which of the following reasons explains why the SRAS curve is upward sloping?

a. Misrepresentation Theory

b. Misperceptions Theory

c. Misunderstanding Theory

d. Sticky-output Theory

2. Wages are sticky in the short-runprimarilybecause:

a. Labor contracts.

b. Misperceptions Theory.

c. Sticky Price.

d. All the other options.

3. Contrary to microeconomics, in macroeconomics,

a. Supply curves are more elastic in the long-run than in the short-run.

b. Supply curves are less elastic in the long-run than in the short-run.

c. Demand curves are less elastic in the long-run than in the short-run.

d. Supply curves are inelastic in short-run.

4. If the US dollar depreciates in value, then (in the US economy):

a. AD will shift right because imports will increase.

b. There will be no shift of either AD or SRAS.

c. AD will shift right because exports will increase.

d. AD will shift right because investment will increase.

5. A convenient policy measure by the Federal Reserve to increase aggregate demand during the current COVID-19 pandemic has been to:

a. Reduce the buying of corporate bonds.

b. Reduce short-term interest rates to zero.

c. Increase reserve requirements for commercial banks.

d. Reduce money supply by 20%.

6. If the US dollar appreciates too much in value, then (in the US economy):

a. Cyclical or short-term unemployment can be expected to remain unchanged.

b. Natural rate of unemployment can be expected to decrease.

c. Cyclical or short-term unemployment can be expected to decrease.

d. Cyclical or short-term unemployment can be expected to increase.

7. If the US dollar appreciates in value, then which of the following mechanisms explain the transition of the US economy from the short-run to the long-run?

a. Price level decreases, expected price level increases, expected wage level increases, wage level decreases, cost of production falls and SRAS shifts to the left.

b. Price level increases, expected price level decreases, expected wage level decreases, wage level decreases, cost of production falls and SRAS shifts to the right.

c. Price level decreases, expected price level decreases, expected wage level decreases, wage level decreases, cost of production falls and SRAS shifts to the right.

d. Price level decreases, expected price level decreases, expected wage level increases, wage level increases, cost of production falls and SRAS shifts to the left.