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Use the following to answer questions
Figure: Determining SRAS Shifts Use the following to answer questions  Figure: Determining SRAS Shifts   -(Figure: Determining SRAS Shifts) If there is a decrease in input prices,the short-run aggregate supply curve will shift from SRAS<sub>0</sub> to _____ and the price level will become _____. A)  SRAS<sub>1</sub>;P<sub>0</sub> B)  SRAS<sub>1</sub>;P<sub>1</sub> C)  SRAS<sub>2</sub>;P<sub>1</sub> D)  SRAS<sub>2</sub>;P<sub>2</sub>
-(Figure: Determining SRAS Shifts) If there is a decrease in input prices,the short-run aggregate supply curve will shift from SRAS0 to _____ and the price level will become _____.


Definitions:

Federal Gasoline Tax

A tax imposed by the federal government on the sale of gasoline, used primarily to fund transportation projects.

General Equilibrium

A state in which all markets in an economy are in simultaneous equilibrium, with supply equaling demand in each market.

Normal Good

A good for which demand increases as the income of the consumer increases, showing a positive relationship between income and demand.

Complements

Goods that are consumed together because the use or enjoyment of one good enhances the use or enjoyment of the other.

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