According to the Monetarists, After an Initial Increase in Aggregate

question 8

Multiple Choice

According to the monetarists, after an initial increase in aggregate demand,

• A) short-run aggregate supply curve will tend to shift leftward, reflecting the effect of higher wages adjusting in the long run.
• B) short-run aggregate supply curve will tend to shift leftward, reflecting the effect of lower wages adjusting in the long run.
• C) aggregate demand curve will tend to shift rightward, reflecting the effect of income adjusting in the long run.
• D) aggregate demand curve will tend to shift lower, reflecting the effect of price level adjusting in the long run.

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Definitions:

DeLoache

A researcher known for studies in cognitive development in children, especially in understanding symbols.

Indicated

Suggested as necessary or appropriate; denoted or signaled.

Hidden

Concealed, not visible or apparent.

Overregularization

The application of regular grammatical rules (e.g., to create past tense and plurals) to irregular verbs and nouns.