Question 2Which of the following statements are true? Which are false? Explain why the false statements are untrue.a. Short-run aggregate supply curves reflect an inverse relationship between the price level and the level of real output. b. The long-run aggregate supply curve assumes that nominal wages are fixed. c. In the long run, an increase in the price level will result in an increase in nominal wages.
b.False, by definition, nominal wages in the long run are fully responsive to changes in the pricelevel.