Consider the Basic AD/AS Model

question 32

Multiple Choice

Consider the basic AD/AS model. In the short run, a shift of the aggregate supply curve would lead to a change in real GDP by mostly changing

• A)the level of investment.
• B)the prices of factors of production.
• C)the productivity of capital.
• D)the amount of labour employed.
• E)the amount of land (natural resources)available to the economy.

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Definitions:

Discrimination

Unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, or sex.

Elderly

Refers to individuals in a population who are aged, typically defined as being of retirement age or older, often considered 65 years and above in many societies.

Normative Economic Statements

Assertions about what ought to be in the economy, reflecting judgments and prescriptions for economic policy.

Positive Economic Statements

Statements that can be tested and validated; they describe the world as it is versus how it should be.