Practice Exam Exercises for Chapter 7

Practice Exam Exercises for Chapter 7 - BEcon 301 Practice...

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BEcon 301 Practice EXAM Exercises for Chapter 7 – Part I 1. A decline in business confidence will shift the AD / AS curve to the left / right . 2. An increase in the oil prices will lead to a decrease / increase in the unemployment rate in the short run, and a further decrease / increase in the unemployment rate in the medium run. 3. If there is a decrease in consumer demand (like the third quarter of 2008) and at the same time there is a decrease in the price of oil (like in the last couple of months) the economy will experience the following changes in the short run : the equilibrium price level (P) will decrease / increase / can’t tell exactly and equilibrium output (Y) will increase / decrease / can’t tell exactly . 4. True / False The aggregate supply relation implies that an increase in the expected price level leads to an increase in the actual price level. 5. Explain what the aggregate supply curve represents and why it is upward sloping.
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This note was uploaded on 12/22/2011 for the course MACROECON 301 taught by Professor Christinanagy during the Fall '09 term at University of Washington.

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Practice Exam Exercises for Chapter 7 - BEcon 301 Practice...

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