Other things being equal, if the quantity of labor supplied is less than the quantity of labor demanded, wages will tend to fall

According to the "self-correcting mechanism" in the AD-AS framework, ________

A) the aggregate demand curve shifts up or down as needed to bring the economy to full employment B) the inflation rate changes as needed to move the economy along the short-run aggregate supply curve until output is at potential output C) the long-run aggregate supply curve shifts until it intersects both the aggregate demand and short-run aggregate supply curves at a single point D) inflation and expected inflation are unaffected by deviations of output from potential output E) none of the above

Increases in income from sources other than employment can cause the labor supply curve to shift to the left

a. True b. False Indicate whether the statement is true or false