When the level of aggregate production is less than the potential output level, this implies that unemployment is high. Jobs are scarce and workers are abundant, which causes nominal wages to fall over time. The SRAS will shift to the left, moving the short run level of aggregate production closer to the potential output level.
Indicate whether the statement is true or false.
Ans: False.
The SRAS will shift to the right over time, moving the short run level of aggregate production closer to the potential output level.
Economics
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In the specific factors model, the effects of trade on welfare overall are ________ and for fixed factors used to produce the imported good they are ________
A) positive; negative B) positive; positive C) negative; positive D) ambiguous; positive E) positive; ambiguous
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Macroeconomics is concerned with the behavior of all of the firms in a particular industry, while microeconomics focuses on a single firm in the same industry
Indicate whether the statement is true or false
Economics