The vertical aggregate supply curve is consistent with
a. the classical model
b. the short run macro model
c. a typical firm's supply curve
d. a positive demand shock
e. a negative demand shock
A
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If the market clearing price of computer tablets rises from $400 to $600, and the market clearing output increases from 5 million to 7 million units,
A) demand decreased and supply remained unchanged. B) supply increased and demand remained unchanged. C) demand increased and supply remained unchanged. D) supply decreased and demand remained unchanged.
The size of the reduction in quantity of labor hired by a firm due to an increase in the wage rate depends upon all of the following except
a. what percentage of total costs are made up of labor costs. b. how much quantity demanded in the output market will be reduced by a higher price. c. the capital to labor ratio before the wage increase. d. how easily other inputs can be substituted for labor.