Assignment-6 - ECN 204 Introductory Macroeconomics...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Page 1 of 10 pages ECN 204 Introductory Macroeconomics Instructor: Sharif F. Khan Department of Economics Ryerson University Fall 2005 Assignment 6 Part A Multiple-Choice Questions [30 marks] Each question is worth 1.5 marks. There is no negative marking for wrong answers To answer each question correctly, you have to choose the best answer from the given four choices. 1. Demand-pull inflation in the short-run increases the price level and: A) real wages. B) real output. C) unemployment. D) nominal wages. 2. The economy enters the long-run once: A) nominal wages become real wages. B) real wages become nominal wages. C) sufficient time has elapsed for wage contracts to expire and nominal wage adjustments to occur. D) sufficient time has elapsed for real GDP to increase and unemployment to decrease. 3. In the long run, demand-pull inflation: A) increases unemployment. B) decreases nominal wages. C) decreases real output. D) increases the price level. 4. In long run aggregate demand-aggregate supply model: A) long-run equilibrium occurs wherever the aggregate demand curve intersects the short-run aggregate supply curve. B) the long-run aggregate supply curve is horizontal. C) the price level is the same regardless of the location of the aggregate demand curve. D) long-run equilibrium occurs at the intersection of the aggregate demand curve, the short-run aggregate supply curve, and the long run aggregate supply curve.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Page 2 of 10 pages Use the following to answer question 5: 5. Refer to the above diagram. The initial aggregate demand curve is AD 1 and the initial aggregate supply curve is AS 1 . In the long run, demand-pull inflation is best shown as: A) a shift of aggregate demand from AD 1 to AD 2 followed by a shift of aggregate supply from AS 1 to AS 2 . B) a move from d to b to a. C) a shift of aggregate supply from AS 1 to AS 2 followed by a shift of aggregate demand from AD 1 to AD 2 .
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 10

Assignment-6 - ECN 204 Introductory Macroeconomics...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online