ORK 10.docx - Google Docs X + document/d/1BIOTgcGoJWbG68eg8mHxg-3rXj1FXuQm/edit at Tools Help Last edit was 7 minutes ago mal text Times New... - - 12 + B JU AS 3 HO- = = = = 13 98 5. 2 3 4 6 7 20. An increase in wages (or the price of any other major input) will cause the aggregate supply curve (SRAS) to a. shift upward b. shift downward c. become steeper d. become less steep 21. If aggregate demand grows more rapidly than aggregate supply (SRAS), prices a. and GDP are both likely to rise b. are likely to rise but GDP is likely to fall c. and GDP are both likely to fall d. are likely to fall but GDP is likely to rise 22. The autonomic adjustment process for a recessionary gap would include: (I) a downward shift in the aggregate supply curve; (II) an upward shift in the consumption function. a. I and II b. I not II c. II not I d. neither I nor II 23 The automatic adjustment process for an inflationary gap would include: (1) a movement up the aggregate demand curve; (II) an upward shift in the aggregate supply curve. a. I and II b. I not II c. II not I d. neither I nor II 24. The economy's selfcorrecting mechanism appears to be more officiant at curing raceccionare gone through deflation than at c Search X F hpHWORK 10.docx - Google Docs X + ogle.com/document/d/1BIOTgcGoJWbG68eg8mHxg-3rXj1FXuQm/edit ert Format Tools Help Last edit was seconds ago Normal text Times New... 12 + B J U A . G P J. SEE BE SB E 2 d. neither I nor II 24. The economy's self correcting mechanism appears to be a. much more efficient at curing recessionary gaps through deflation than at curing inflationary gaps through inflation b. much more efficient at curing inflationary gaps through inflation than at curing recessionary gaps through deflation c. about equally efficient at curing recessionary gaps through deflation and at curing inflationary gaps through inflation d. unable to cure either recessionary or inflationary gaps 25. While deflation did occur before World War II, wages and prices have exhibited downward rigidity since the end of World War II. Among the explanations offered for this are (I) recessions have been shorter in the postwar years and (II) firms fear the loss of good workers if they cut wages in a recession. a. I not II b. II not I c. I and II d. neither I nor II Search hpHWORK 10.docx - Google Docs x + com/document/d/1BIOTgcGoJWbG68eg8mHxg-3rXj1FXuQm/edit Format Tools Help Last edit was seconds ago Normal text Times New... 12 + B I U A . C P O . B = = = 13 # 8 . 1 . E 2 4 5 7 26. Money in the contemporary United States is almost entirely a. commodity money b. paper (i.e., fiat) money c. barter money d. backed by gold 27. Excess reserves are put to use by a bank when it a. purchases government securities b. pays off the mortgage on its building c. extends loans to its customers d. puts the cash in the vault to back existing loans 28. The banking system receives a cash deposit of $200,000. Total deposits eventually rise to $2 Million. The value of R, the official reserve requirement, is a. 10 b. 0.10 c. 5 d. 0.20 29 The value of R, the official reserve requirement, will give an overestimate of the money multiplier if (I) banks wish to keep excess reserves and (II) if households and firms decide to hold more cash outside the banking system. a. I and II b. I not II c. II not I d. neither I nor II 30. When the Fed wishes to contract the money supply it can Search EX F