Q3 Which of the following would shift the AS curve down to the right? a. Increase in the price of oil. b. Increase in productivity brought about by innovation and R&D. c. Increase in imports. d. Decrease in nominal wages. e. Answers B and D.

Q4 Most economists believe that classical macroeconomic theory is a good description of the economy a. in neither the short nor long run. b. in the short run and in the long run. c. in the short run, but not in the long run. d. in the long run, but not in the short run.