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Duplicate of Aggregate Demand, Aggregate Supply and the Business Cycle Flashcards | StudBud
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Duplicate of Aggregate Demand, Aggregate Supply and the Business Cycle
Duplicate of Aggregate Demand, Aggregate Supply and the Business Cycle
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graphing AS and AD, defining stagflation
Flashcards
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Questions
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Answers
1
If the economy is operating at a peak in a business cycle, on an AS/AD graph it would be
left of full employment
below full employment
at full employment
above full employment
2
A gap that exists when real GDP exceeds potential GDP and that brings a rising price level is
an inflationary gap.
a full employment gap.
a recessionary gap.
a market failure.
3
The shift from D to D' could be caused by
an increase in C
an increase in T
an increase in I
an increase in G
4
A combination of recession (rising unemployment) and inflation (rising prices) is called
stagflation
disintermediation
misery
disinflation
5
The shift to
AD'
could be caused by
an increase in Xn
a decrease in I
an increase in AS
an increase in T
6
Expansionary Fiscal Policy would best be used during
full employment
expansion
inflation
recession
7
The shift from AS
1
to AS
2
could be caused by
a decrease in immigration
a decrease in I
an increase in G
an increase in technology
8
The order of the shifts in the graph below is __________ then _________.
AD ↑, AS ↓
AS↓, AD↑
AD↑, AS↑
AS↑, AD↓
9
The shift from AS to AS1 could be caused by
an increase in technology
an increase in wages
an increase in imports
a decrease in the price of oil
10
Left alone, an economy will always gravitate towards
full employment
recession
inflation
unemployment
