Q10. Of the following explanations of the short run aggregate supply curve, which best explains the relatively horizontal area?

a.With an economy operating at potential output, an increase in aggregate demand causes a rise in the price level, but has no or little effect on real output.

b.With an economy operating below potential output, an increase in aggregate demand causes real output to increase with no or little effect on the price level

.c.An increase in aggregate demand causes both the price level and real output to increase.

Q11. When describing the economy's aggregate expenditure components impacted by the real level of income, which of the following terms is excluded from that description?

a.Marginal Propensity to Consume

b.Autonomous expenditure

c.Macroeconomic Equilibrium

Q12. To find macro equilibrium in a table, the numbers for ________ and ________ should equal each other.

a.Keynesian Cross; taxes

b.aggregate expenditure; GDP/national income

c.exports; imports