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1-Which would NOT shift the aggregate demand curve to the left?
A.an appreciated currency
B.a lower tax rate
C.a higher interest rate
D.lower investment
2-If there is an inflationary gap, the market will transition to long run equilibrium by
A.an increase in SRAS caused by a decrease in the wage rate.
B.a decrease in SRAS caused by an increase in the wage rate.
C.a decrease in SRAS caused by a decrease in the wage rate.
D.an increase in SRAS caused by an inecrease in the wage rate.
3-If the price level rises and the money wage rate remains constant, the quantity of real GDP supplied ______ and there is a movement up along the ______ aggregate supply curve.
A.increases; short-run
B.does not change; long-run
C.does not change; short-run
D.decreases; long-run
If pasta is an inferior good and if the price of pasta increases, the income effect _____________ the quantity demanded, and the substitution effect ___________ the quantity demanded.
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