Exam 23: Aggregate Demand and Supply Analysis

To manage the large export losses resulting from the U.S financial crisis, China implemented ________ policy, amounting to ________ percent of Chinese GDP.

Some unemployment is always present due to the ________ and ________ components, which are greater than zero.

Suppose the economy is producing at the natural rate of output. Assuming a fixed natural rate of output and everything else held constant, the development of a new, more productive technology will cause ________ in the unemployment rate in the long run and ________ in the inflation rate in the short run.

The positively sloped short-run aggregate supply curve reflects the assumption that labour prices are ________.

The long-run aggregate supply curve shifts to the right when there is ________.

According to aggregate demand and supply analysis, the negative supply shocks of 1973-1975 and 1978-1980 had the effect of ________.

Everything else held constant, an autonomous monetary policy tightening ________ aggregate ________.

Everything else held constant, when output is ________ the natural rate level, wages will begin to ________, decreasing short-run aggregate supply.

Everything else held constant, a decrease in net taxes ________ aggregate ________.

Figure 24-1 -In Figure 24.1 above, a ________ supply shock will shift the aggregate supply curve to AS₂ and the economy will return to the long run equilibrium at point ________.

Everything else held constant, a purchase of government securities by the Bank of Canada will cause ________.