Use the following graph to answer the next question.Assume the economy is initially located on AD0 and AS0. An increase in resource prices would result in price ________ and real domestic output ________.

To ensure that the fundamental identity of national income accounting holds, changes in inventories are

A) treated as part of expenditure. B) treated as part of saving. C) ignored. D) counted as consumption.

Changes in total factor productivity are plausible causes of business cycles because productivity-induced business cycles correctly predict

A) real wages and total hours must be procyclical. B) real wages and consumption must be procyclical. C) total hours worked and consumption must be procyclical. D) consumption and government spending must be procyclical.