An increase in the price level will
A) shift the short-run aggregate supply curve to the left.
B) shift the short-run aggregate supply curve to the right.
C) move the economy up along a stationary short-run aggregate supply curve.
D) move the economy down along a stationary short-run aggregate supply curve.
Answer: C
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A nation's production possibilities curve might shift to the left (inward) as a result of:
A. technological advance. B. increases in the size of the labor force. C. the depletion of its soil fertility due to overplanting and overgrazing. D. investing in more capital goods.
Chris and Jordan are a two-person household. Chris's market hourly wage is $40, but Chris can also produce $20 of household production each hour. Jordan's market hourly wage is $50, but Jordan can also produce $30 of household production each hour. This household chooses work schedules to maximize utility. When it does this, which of the following cannot occur.
A. Jordan specializes in marketplace work, while Chris splits time between marketplace and household work. B. Chris specializes in marketplace work, while Jordan splits time between marketplace and household work. C. Jordan specializes in household production, while Chris specializes in marketplace work. D. Chris specializes in marketplace work while Jordan specializes in household production. E. All of the above results can happen.