When Output Is Below Its Full-Employment Level, the Short-Run Aggregate

question 29

Multiple Choice

When output is below its full-employment level, the short-run aggregate supply will shift down and to the right because

• A)the expected price level will be below the actual price level.
• B)workers' wages will decline.
• C)prices of nonlabor inputs will rise.
• D)workers' wages will rise.

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