If the prevailing price of shirts is $10 and at this price demanders demand 100 shirts while suppliers are willing to supply 110 shirts, there is a(n)
a. shortage at the $10 price.
b. surplus at the $10 price.
c. equilibrium in this market.
d. shortage if price were to rise above $10.
b
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The horizontal axis for an aggregate demand curve measures
A) output of all goods and services measured as a quantity index. B) real Gross Domestic Product (GDP). C) quantity demanded of the representative good. D) disposable personal income.
By looking at the graphs showing a negative supply shockâs impact on aggregate demand and aggregate supply and on the Phillips curve, we can see that high energy prices in the late 1970s ______.
a. increased price levels and RGDP, but decreased inflation rates and unemployment rates
b. increased price levels, RGDP, inflation rates, and unemployment rates
c. decreased price levels, RGDP, inflation rates, and unemployment rates
d. increased price levels, inflation rates, and unemployment rates, but decreased RGDP