Whether Aggregate Supply Shifts Quickly or Slowly to Restore Equilibrium

question 210

Multiple Choice

Whether aggregate supply shifts quickly or slowly to restore equilibrium at potential output depends crucially on

• A)how quickly planned investment spending adjusts to changes in population growth
• B)how quickly planned consumption spending adjusts to changes in the price level and nominal wages
• C)how quickly technology changes to increase aggregate supply
• D)whether the economy is experiencing a contractionary gap or an expansionary gap
• E)how quickly real wages adjust to restore full employment in the labor market

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