Author Question: If there was no misperception effect, but there was a profit effect in the short run, then SRAS is ... (Read 30 times)

Alainaaa8 · **on:** Jun 30, 2018

If there was no misperception effect, but there was a profit effect in the short run, then SRAS is ____ and LRAS is ____.
a. upward sloping: vertical
b. upward sloping; upward sloping
c. vertical; vertical
d. vertical; upward sloping

Question 2

Which of the following will be observed if the U.S. federal government reduces fiscal spending, keeping other things constant?
a. The aggregate demand curve will shift to the right.
b. The aggregate expenditure in the economy will decrease.
c. The economy will approach potential GDP.
d. The marginal propensity to consume will increase.
e. The average price level will increase.