If the demand for a good is perfectly inelastic, then:
a. the value of price elasticity of demand of the good is equal to 1.
b. the value of price elasticity of demand of the good is equal to -1.
c. the demand curve of the good is nonexistent.
d. consumers are very responsive to a change in the price of the good.
e. quantity demanded does not change when price of the good changes.
e
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Which of the following mechanisms helps output to return to potential after a supply shock?
a. A change in the nominal wage b. Changes in business decision making strategies c. Changes in the capital stock d. The rigidity of the price level e. Changes in inventories
Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward