09-03-2009 112315 PM

09-03-2009 112315 PM - C) high consumption rate for high...

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.*> B . . Real National Jncome^GDI?) FIGURE 24-2 13) Referring to Figure 24-2, if the economy is in equilibrium at YI, the automatic adjustment process will restore potential output, Y* through A) wage decreases and a rightward shift of the AD curve. B) wage increases and a leftward shift of the short run AS curve. C) an increase in potential GDP to intersect both the AD and short run AS curves at A. D) a leftward shift of the AD to intersect both the short run AS and potential GDP at C. E) wage increases and a shift right in the short run AS curve. 14) Many economists argue that Japan's remarkable economic success between 1950 and 1990 was due to Japan's A) excessive amounts of money invested into research and development. B) restrictive trade barriers thus eliminating foreign competition.
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Unformatted text preview: C) high consumption rate for high quality electronic products. D) skilled labour force that developed over those forty years. E) high savings rate. 13) 14) 15) All long run increases in national income can be traced to a rightward shift in aggregate A) demand due to new technology which causes continuous growth in consumer spending. B) supply because higher wages will increase the participation rate. C) supply resulting from the availability and employment of more factors and/or increased factor productivity. D) demand because excess of demand will increases wages which in turn increases employment. E) demand because increases in demand will lead to increases in output and prices. 15)...
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This note was uploaded on 01/15/2012 for the course ECON 104 taught by Professor Peter during the Summer '09 term at Camosun College.

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