The Long-Run Aggregate Supply Curve Is Vertical at $12 Trillion

question 231

Multiple Choice

The long-run aggregate supply curve is vertical at $12 trillion but the short-run aggregate supply curve intersects the aggregate demand curve at $13 trillion.We know that

• A) the economy is producing below full employment in the short run, and will adjust by hiring more workers, thus decreasing unemployment.
• B) the price level is too high. The long-run equilibrium will occur with a lower price level.
• C) adjustments will occur so that the long-run aggregate supply equals $13 trillion.
• D) adjustments will occur so that the short-run aggregate supply eventually intersects the aggregate demand curve at $12 trillion.

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Definitions:

Personality

The characteristic set of behaviors, cognitions, and emotional patterns that evolve from biological and environmental factors.

Patterns of Thought

Distinctive ways of thinking and understanding the world, often influenced by culture, experience, and education.

Consistent Patterns

Consistent patterns refer to recurring behaviors or phenomena that show a regular and predictable form, often observed in data analysis, behavior studies, and natural processes.

Five Factor Model

A theory identifying five primary dimensions of personality: openness, conscientiousness, extraversion, agreeableness, and neuroticism.