Answer the following statements true (T) or false (F)
1) The short-run aggregate supply curve is vertical and the long-run aggregate supply curve is horizontal.
2) The short-run aggregate supply curve shifts to the left when nominal wages rise in response to price level increases.
3) In the extended AD-AS model, the long-run aggregate supply curve is vertical.
4) Demand-pull inflation and cost-push inflation are identical concepts because both involve
lower unemployment rates and rising prices.
5) The Phillips Curve suggests an inverse relationship between increases in the price level and
the level of employment.
1) F
2) T
3) T
4) F
5) T
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a. True b. False Indicate whether the statement is true or false
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A. fiscal B. normative C. positive D. monetary