Exam 26: Bringing in the Supply Side: Unemployment and Inflation

As long as the aggregate supply curve is upward sloping, an increase in aggregate demand will increase

Inflationary GDP is the amount by which equilibrium real GDP falls short of the full employment level of GDP.

Productivity is the amount of output produced by a unit of input.

The existence of an inflationary gap or an recessionary gap depends on the

When inflation occurs, net exports will

Figure 10-3 ​ -In Figure 10-3, both graphs (a) and (b) indicate that the economy is experiencing a(n)

Recessionary gap arises when

The principal way in which an economy self-corrects from an inflationary gap is through

A higher expected price level would shift the short-run aggregate supply curve to the left, and a lower expected price level would shift the short-run aggregate supply curve to the right.

Self-correcting mechanism reveals that

The recessions of the 1970s are often attributed to an increase in oil prices.

From the mid-1980s until late 2007, many world economies became less volatile because of

When OPEC cut energy production in 1973, the aggregate supply curve shifted outward.

According to an old saying, when too much money is chasing too few goods, we have a(n)

Which of the following shifts the short-run supply curve to the right?

Many economists are in favor of increased immigration of adult foreigners who possess high levels of skills and education.Why?

If the price level rises, what will happen to the level of real GDP supplied?

Figure 10-8 ​ -Figure 10-8 illustrates a period of

An economist who claims that an increase in government spending would result mainly in a higher price level believes the economy is operating where the

In our modern economy, the adjustment process necessary to eliminate a recessionary gap is very rapid.