Consider the Basic AD/AS Macro Model in Long- Run Equilibrium

question 28

Multiple Choice

Consider the basic AD/AS macro model in long- run equilibrium. A negative AS shock will the price level and output in the short run. In the long run, the price level will
And output .

• A)increase; increase; increase further; will be restored to potential output
• B)decrease; decrease; decrease further; will decrease further
• C)increase; decrease; decrease; will be restored to potential output
• D)increase; decrease; increase further; will be restored to potential output
• E)decrease; decrease; decrease further; will be restored to potential output

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Definitions:

Soybean Workers

Individuals engaged in the cultivation, maintenance, and harvesting of soybeans.

Equilibrium Wage

The wage rate at which the quantity of labor demanded by employers equals the quantity of labor supplied by workers, resulting in no labor surplus or shortage.

Immigrate

To immigrate means to move into a country from another one to live permanently.

Minnesota

A state in the Midwestern United States known for its lakes, forests, and vibrant cultural scene, as well as its contributions to industry, agriculture, and education.