The short-run Aggregate Supply curve is upward sloping only because we assume that resource costs are held .

Related MCQs

• An increase in aggregate demand (given no change in aggregate supply) will cause                            inflation.
• If Aggregate Demand exceeds Aggregate Supply, unwanted inventories will begin to accumulate, forcing firms to                           prices to get rid of those inventories.
• A decrease in the price level shifts the               curve to the right, and the aggregate demand curve .
• Which of the following events will shift the Aggregate Supply curve to the left?
• Which factor would shift the Aggregate Demand curve to the right?
• Which of the following is not a component of Aggregate Demand?
• If the short-run IS–LM equilibrium occurs at a level of income below the natural level of output, then in the long run the price level will , shifting the curve to the right and returning output to the natural level.
• The Phillips curve implied that there was a trade- off available to governments between:
• In the IS–LM model, the impact of an increase in government purchases in the goods market has ramifications in the money market, because the increase in income causes a(n) in money             .