35 - CHAPTER 35 Extending the Analysis of Aggregate Supply 1 In terms of aggregate supply a period in which nominal wages and other resource prices are

35 - CHAPTER 35 Extending the Analysis of Aggregate Supply...

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CHAPTER35 Extending the Analysis of Aggregate Supply1. In terms of aggregate supply, a period in which nominal wages and other resource prices are unresponsive to price-level changes is called the: A) long run. B) short run. C) immediate market period. D) very long run. Ans: 2. In terms of aggregate supply, a period in which nominal wages and other resource prices are fully responsive to price-level changes is called the: A) long run. B) short run. C) immediate market period. D) very long run. Ans: Use the following to answer questions 35-40: 35. Refer to the above diagram. The initial aggregate demand curve is AD1and the initial aggregate supply curve is AS1. Demand-pull inflation in the short run is best shown as: A) a shift of the aggregate demand curve from AD1to AD2. B) a move from dto bto a. C) a move directly from dto a. D) a shift of the aggregate supply curve from AS1to AS2. Ans:

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