Which of the following is true in the short run?
a. The aggregate supply curve is horizontal
b. The aggregate supply curve is vertical.
c. Per-unit costs do not increase as much as output prices when the price level rises.
d. An increase in price per unit results in a decrease in profit per unit.
e. Firms' total costs of production decrease as output expands beyond the potential level.
c
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The reference base period that the BLS uses to measure the CPI is
A) 1998-2000. B) 2005. C) 1967-1969. D) 1982-1984. E) 1993-1995.
In 2005 hurricane Katrina devastated large portions of the Gulf Coast economy. Many refineries went offline disrupting oil refining and distribution. What do you think was a likely result?
A) the restricted supply constituted a cost push shock that would have shifted the long run AS curve to the right B) the restricted supply constituted a cost push shock that would have shifted the short run AS curve to the left C) the restricted supply constituted a cost push shock that would have meant an upward movement along the Phillips curve D) all of the above E) none of the above