If Workers and Other Resource Suppliers Negotiate Higher Resource Payments,which

question 148

Multiple Choice

If workers and other resource suppliers negotiate higher resource payments,which of the following is true?

• A)The long-run aggregate supply curve will shift rightward.
• B)There will be a leftward movement along a fixed short-run aggregate supply curve.
• C)The long-run aggregate supply curve will shift leftward.
• D)The short-run aggregate supply curve will shift rightward.
• E)Higher resource payments will cause the price level to rise.

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Definitions:

Ownership Of Scarce Inputs

The possession and control over resources that are limited in nature and necessary for production.

Network Externalities

The effect that one user of a good or service has on the value of that product to other people, where the value increases as the number of users rises.

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale as fixed costs are spread out over more units of output.

Natural Monopoly

A monopoly that exists when increasing returns to scale provide a large cost advantage to having all output produced by a single firm.