In the Short Run ________

question 37

Multiple Choice

In the short run ________.

• A)the more flexible wages and prices are,the more inflation responds to the output gap
• B)the more sticky wages and prices are,the more difficult to tell the difference between the short run and long run aggregate supply curves
• C)if wages and prices are sticky,aggregate output is always at its potential level
• D)all of the above
• E)none of the above

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Definitions:

Preferred Stock

A class of ownership in a corporation with a fixed dividend that has priority over common stock dividends but typically does not have voting rights.

Par Value

The nominal or face value of a bond, share, or coupon as stated by the issuer.

Market Price

The up-to-the-minute market price for assets or services open for buy or sell transactions.

Dividends

Funds distributed by a company to its shareholders from its profits.