Which of the following does the long-run Phillips curve tell us?

Select one:

a.That the unemployment rate can take on any value in the long run

b.That unemployment will return to the natural rate in the long run

c.That output can be maintained above potential in the long run

d.That output can be below potential in the long run

e.That the inflation rate cannot rise above 10 percent in the long run

The classical model

Select one:

a.was developed to explain the long period of poor economic performance during the Great Depression

b.is an attempt to explain why the economy tends to perform rather well over long periods of time

c.is another name for the short-run macro model

d.is believed by most economists to be a better explanatory model for short-term, rather than long-term, economic performance

e.was not really accepted as a legitimate economic theory until the 1950s

In the short-run macro model, a decrease in the money supply will

Select one:

a.move the economy to the left along the aggregate expenditure line

b.shift the aggregate expenditure line upward

c.move the economy to the right along the aggregate expenditure line

d.shift the aggregate expenditure line downward

e.not affect the aggregate expenditure line