If the short-run aggregate supply curve is shifting down repeatedly, it is rather likely that ________
A) output is declining repeatedly, relative to potential output
B) the long-run aggregate supply curve is shifting to the left
C) negative price shocks are recurring
D) all of the above
E) none of the above
E
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Which of the following statements correctly differentiates between a model and a hypothesis?
A) Testing a hypothesis does not require data, whereas testing a model requires data. B) A model is a simplified representation of reality, whereas a hypothesis is a model's predictions. C) A hypothesis can be used to make predictions for the future, whereas a model can only explain the past. D) Testing a model requires data, whereas testing a hypothesis does not require data.
The circular-flow diagram illustrates that:
A) production generates income so that income and production are the same. B) the economy's income is less than its production. C) the economy's income is exceeds its production. D) none of the above are necessarily correct.