Author Question: If global pollution causes climatic changes that permanently harm crop production worldwide, ... (Read 38 times)

HCHenry · **on:** Jun 30, 2018

If global pollution causes climatic changes that permanently harm crop production worldwide, aggregate supply and demand analysis would lead us to expect:
a. an increase in the price level.
b. a decrease in the price level.
c. rightward shifts of the aggregate demand and aggregate supply curves.
d. a leftward shift of the aggregate demand curve.
e. an increase in the potential level of real GDP.

Question 2

In the long run, an increase in aggregate demand:
a. increases the price level and real output, but the effect on the price level is larger.
b. increases the price level and real output, but the effect on output is larger.
c. affects only real output.
d. affects only the price level.
e. affects neither the price level nor real output.