The Aggregate Supply Curve (Short Run)

question 222

Multiple Choice

The aggregate supply curve (short run)

• A) graphs as a horizontal line.
• B) is steeper above the full-employment output than below it.
• C) slopes downward and to the right.
• D) presumes that changes in wages and other resource prices match changes in the price level.

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Definitions:

Wasteful

Referring to the use or allocation of resources in an inefficient manner, leading to unnecessary loss or expenditure.

Interstate Highway

A network of controlled-access highways that form part of the National Highway System in the United States, facilitating interstate and long-distance travel.

Nonexcludability

A characteristic of public goods where it is impossible or highly costly to exclude individuals from consuming the good.

Marginal Costs

The hike in total expenditure resulting from the production of an incremental unit of a product or service.