short run aggregate supply

As the price level in the economy decreases:

there is a movement down and to the left along the short-run aggregate supply curve.

In the short-run, as the price level increases:

total aggregate output increases because higher revenues received by firms and fixed production costs lead to higher profits.

The short-run aggregate supply curve is:

upward sloping

When workers expected continued inflation

workers will demand increases in their nominal wages which will shift the SRAS curve leftward.

___________________ are considered to be the main source of economic growth

improvements in worker productivity

As the price level in the economy increases, PROFIT PER UNIT will:

increase

Changes in the aggregate price level cause:

movements along the short-run aggregate supply curve

The short-run aggregate supply curve assumes that:

nominal wages do not respond to changes in the price level

As the price level in the economy decreases, PRODUCTION COST PER UNIT will:

not change

which of the following would shift the aggregate supply curve? A change in:

prices of resources

In the short-run, as the price level in the economy increases:

profits for firms also increase due to the "fixed" or sticky production costs

The short-run is defined as that period of time:

some cost of production are fixed or unchanged due to contracts

The short-run can be defined as that time frame when there are

sticky wages

When previously fixed costs such as workers' wages, rent, etc. adjust, it means:

the economy has moved from the short-run to the long-run

Which of the following will cause a decrease short-run aggregate supply?

the government increases corporate taxes, the government takes away corporate subsidies, the government imposes tariffs on imported raw materials

Which of the following will cause an increase short-run aggregate supply?

the government lowers corporate taxes, the government grants subsidies, the government removes tariffs on imported raw materials

In the short-run firms profits increase when

the price level increased but the nominal wages do not

Increase in workers' nominal wages would

create a leftward shift of the SRAS curve

Improvements in worker productivity

create a rightward shift of the SRAR curve

As the price level in the economy decreases, PROFIT PER UNIT will

decrease

In the short-run, workers wages and other production costs such as rent and monthly loan repayments are:

"fixed" or sticky

In the short-run, workers wages are:

"fixed" or sticky

Suppose that an economy produces 500 widgets. It takes 10 units of labor at $15 a worker and 4 units of capital at $50 a unit to produce 500 widgets. The per unit cost of production is:

$0.70

An increase in business taxes will tend to:

decrease aggregate demand and decrease short-run aggregate supply

Which of the following will cause an increased short-run aggregate suppy?

a decrease in workers' nominal wages, an appreciated or "stronger" currency when purchasing foreign made raw materials, a decrease in energy costs

The short-run aggregate supply curve shows _____________ relationship between the price level and the aggregate quantity of goods and services supplied

a direct or positive

According to the short-run aggregate supply curve, when the _________ rises, the quantity of _________ rises.

aggregate price level; aggregate output supplied

Which of the following will cause a decreased short-run aggregate supply?

an increase in energy costs, an increase in workers' nominal wages, a depreciated or "weaker" currency when purchasing foreign made raw materials

Which would most likely increase short-run aggregate supply?

an increase in worker productivity

In the short run:

as the price level increases, nominal wages remain the same

Suppose that real domestic output in an economy is 50 units of widgets, the quantity of inputs is 10 and the price of each input is $2. If productivity increased such that 60 units of widgets are now produced with the quantity of inputs still equal to 10, then per-unit production costs would:

decrease and aggregate supply would increase

Which of the following would be considered to be one of the factor that shift the short-run aggregate supply curve?

government regulation

An individual firm enters its "long-run" period when every last production cost:

has been renegotiated or becomes flexible as contracts expire

If Congress passed much stricter laws to control the air pollution caused by businesses, this action would tend to:

increase per-unit production costs and shift the aggregate supply curve to the left

An increase in the price level will:

increase the level of Real GDP produced by suppliers

As the price level increased the total quantity of aggregate output produced:

increases

the short-run aggregate supply curve shows the:

level of real domestic output which will be produced at each possible price level