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