An aggregate supply curve with a positive slope is associated with an economy in which:
a. input prices and final goods prices always change by the same amount
b. firms expect output prices to be unaffected by changes in input prices.
c. nominal wages and salaries do not change much in the short run.
d. firms expect consumer demand to be unaffected by changes in prices of final goods.
c
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An increase in unplanned inventory investment for the entire economy equals the excess of
A) output over aggregate supply. B) output over aggregate demand. C) aggregate supply over output. D) aggregate demand over output.
The reason why some economists believe that attempts by the Fed to surprise the public in a systematic way cannot be successful is that
A) information about the Fed's plans will inevitably be leaked to the public. B) the Fed announces its goals before Congress and publishes its policy actions in the Federal Reserve Bulletin six weeks after they take place. C) the public would eventually figure out what the Fed's policies were, negating the Fed's surprise. D) competition in the money markets would neutralize the Fed's intervention.