In the long run ?

Related Mcqs:

1. Suppose the economy is initially in long run equilibrium Then suppose there is a drought that destroys much of the wheat crop if policymakers allow the economy to adjust to long-run equilibrium on its own, according to the model to aggregate demand and aggregate supply what happens to prices and output in the long run ?

   A. Output rises; prices are unchanged from the initial value
   B. Output and the price level are unchanged from their initial values
   C. Output falls; prices are unchanged from the initial value
   D. Prices fall; output is unchanged from its initial value

2. The short run marginal cost curve cuts the short run total cost curve and short run average variable cost curve ?

   A. At their lowest points
   B. When they are declining
   C. When they are increasing
   D. When marginal revenue is zero

3. If, in the long run, people adjust their price expectations so that all prices and incomes move proportionately to an increase in the price level then the long-run Phillips curve ?

   A. is vertical
   B. is negatively sloped
   C. has a slope that is determined by how fast people adjust their price expectations
   D. is positively sloped

4. Refer to Exhibit 6. Suppose the economy is Operating in long-run equilibrium at point E. In the long run a monetary contraction will move the economy in the direction of point ?

   A. F
   B. a
   C. H
   D. I

5. Which of the following statements is true regarding the long-run aggregate supply curve? The long-run aggregate supply cruve ?

   A. Is vertical because an equal change in all prices and wages leaves output unaffected
   B. is positively sloped because price expectations and wages tend to be fixed is the long run
   C. shifts right when the government raises the minimum wage
   D. shifts left when the natural rate of unemployment falls

6. Suppose the economy is initially in long-run equilibrium Then suppose there is an increase in military spending due to rising international tensions According to the model of aggregate demand and aggregate supply what happens to prices and output in the long run ?

   A. Output falls; prices are unchanged from the initial value
   B. Price fall; output is unchanged from its initial value
   C. Output and the price level are unchanged from their initial values
   D. Prices rise; output is unchanged from its initial value

7. Suppose the economy is initially in long-run equilibrium Then suppose there is an increase in military spending due to rising international tensions According to the model of aggregate demand and aggregate supply what happens to prices and output in the short run ?

   A. Price fall; output rises
   B. Price fall; output falls
   C. Price rise; output fall
   D. Price rise; output rise

8. Suppose the economy is initially is long run equilibrium Then suppose there is a drought that destroys much of the wheat crop According to the model of aggregate demand and aggregate supply, what happens of prices and output in the short run ?

   A. Price rise; output falls
   B. Price fall; output rises
   C. Price rise; output rises
   D. Price fall; output falls

9. In the short run, the supply of capital is ________ and in the long run will depend on _______?

   A. variable, technology
   B. fixed, expectations
   C. fixed, rental rate of capital
   D. variable, interest rates

10. For a competitive firm, its short run supply curve is ______ and its long run supply curve is _____?

    A. SMC, LMC
    B. SMC above SAVC, LMC above LAC
    C. SMC below SAVC, LMC above LAC
    D. SMC below SAVC, LMC bellow LAC