A Decrease in Aggregate Supply in the Short Run Is

question 95

Multiple Choice

A decrease in aggregate supply in the short run is

• A)interpreted to mean that less total output will be supplied at any given price level.
• B)caused by a decrease in the price level.
• C)reflected in a shift to the right in the AS curve.
• D)caused by an increase in the price level.
• E)reflected in a movement to the left along the AS curve.

Discuss the impact of tax policies on economic behavior and government revenues, including the Laffer Curve concept.

Recognize the debate over discretionary versus rule-based economic policies.

Investigate the impact of expectations on fiscal and monetary policy effectiveness.

Understand the arguments for and against the use of policy rules to stabilize the economy.

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