The Long-Run Aggregate Supply Curve Is Vertical

question 197

Multiple Choice

The long-run aggregate supply curve is vertical:

• A)because the rate of inflation is steady in the long run.
• B)because resource prices eventually catch up with product prices.
• C)because product prices always increase at a faster rate than resource prices.
• D)only when the money supply increases at the same rate as real GDP.

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Definitions:

Foreign Policy

A government's strategy in dealing with other nations, involving diplomacy, economic measures, military action, and treaties to advance national interests.

Harry S. Truman

The 33rd President of the United States, serving from 1945 to 1953, known for implementing the Marshall Plan to rebuild the economy of Western Europe, and for leading the U.S. during the early Cold War.

Vyachslaw Molotov

A prominent Soviet politician and diplomat known for his role in the Stalin administration, including as Foreign Minister.

Joseph Stalin

A Soviet political leader who served as general secretary of the Communist Party of the Soviet Union from 1922 until his death in 1953, known for his totalitarian rule and policies leading to massive industrialization and collectivization.