Exam 22: Aggregate Demand and Supply Analysis

According to aggregate demand and supply analysis,America's involvement in the Vietnam War had the effect of

Everything else held constant,an increase in planned investment expenditure ________ aggregate ________.

The Phillips curve indicates that when the labor market is ________,production costs will ________ and aggregate supply increases.

By analyzing aggregate demand through its component parts,we can conclude that,everything else held constant,a decline in the price level causes

The fact that an economy always returns to the natural rate level of output is known as

Everything else held constant,a decrease in planned investment expenditure ________ aggregate ________.

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

Suppose the economy is producing at the natural rate of output.An open market sale of bonds by the Fed will cause ________ in real GDP in the short run and ________ in the aggregate price level in the short run,everything else held constant.

According to aggregate demand and supply analysis,the favorable supply shock of 1995-1999 had the effect of

Everything else held constant,an increase in government spending ________ aggregate ________.

Suppose the economy is producing below the natural rate of output and the government is suffering from large budget deficits.To deal with the deficit problem,suppose the government takes a policy action to reduce the size of the deficits.This policy action will cause ________ in the unemployment rate in the short run and ________ in the aggregate price level in the short run,everything else held constant.

Everything else held constant,a balanced budget increase in government spending (that is,an increase in government spending that is matched by an identical increase in net taxes)will

Suppose the economy is producing at the natural rate of output.An increase in consumer and business confidence will cause ________ in real GDP in the short run and ________ in the aggregate price level in the short run,everything else held constant.

Suppose the economy is producing at the natural rate of output.A decrease in consumer and business confidence will cause ________ in real GDP in the short run and ________ in the aggregate price level in the short run,everything else held constant.

Everything else held constant,a change in workers' expectations about the aggregate price level will cause ________ to change.

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 short run and ________ in the aggregate price level in the short run.

The long-run aggregate supply curve is a vertical line passing through

A decrease in the availability of raw materials that increases the price level is called a ________ shock

The long-run aggregate supply curve is

Everything else held constant,a decrease in government spending ________ aggregate ________.