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In Figure 24.1 above, at point 2, the shift of the aggregate supply curve from AS1 to AS2 is a
result of ____ wages that ____ production cost.
A) increasing; increase
B) increasing; reduce
C) decreasing; decrease
D) decreasing; increase
Answer: A
Diff: 2 Type: MC Page Ref: 589
Skill: Applied
Objective List: 24.3 Differentiate between short-run and long-run equilibria in the context of the
aggregate demand and supply framework
In Figure 24.1 above, an equilibrium output greater than Yn is ____ attainable in the
____-run.
A) only; short
B) only; long
C) not; short
D) always; long
Answer: A
Diff: 2 Type: MC Page Ref: 590
Skill: Applied
Objective List: 24.3 Differentiate between short-run and long-run equilibria in the context of the
aggregate demand and supply framework
In Figure 24.1, output levels below Yn will cause the aggregate ____ function to shift to
the ____.
A) supply; right
B) supply; left
C) demand; left
D) Both A and C
Answer: A
Diff: 2 Type: MC Page Ref: 590
Skill: Applied
Objective List: 24.3 Differentiate between short-run and long-run equilibria in the context of the
aggregate demand and supply framework