According to new classical school of economics, the aggregate supply curve is:
a. horizontal in both the short run and the long run.
b. vertical in the short run and upward-sloping in the long run.
c. upward-sloping in both the short run and the long run.
d. vertical in both the short run and the long run.
e. upward-sloping in the short run and vertical in the long run.
e
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If an economy is producing a level of output that is on its production possibilities curve, the economy
A) has idle resources. B) has idle resources but is using resources efficiently. C) has no idle resources but is using them inefficiently. D) has no idle resources and is using resources efficiently.
Which of the following statements is NOT true?
A) Unemployment in the US economy represents an excess demand for labor. B) A surplus may be reduced by shifting the demand curve rightward. C) A surplus may be reduced by shifting both the supply and demand curves. D) A shortage may be reduced by shifting the supply rightward.