The Vertical Long-Run Aggregate Supply Curve Satisfies the Classical Dichotomy

question 97

Multiple Choice

The vertical long-run aggregate supply curve satisfies the classical dichotomy because the natural rate of output does not depend on:

• A) the labor supply.
• B) the supply of capital.
• C) the money supply.
• D) technology.

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Definitions:

Unskilled Labor

Refers to workers who lack specialized training or qualifications, often performing manual or routine tasks.

Marginal Product

The additional output resulting from a one-unit increase in the use of a variable input, while holding all other inputs constant.

Demand Shift

A change in the demand curve due to factors other than the price of the good, such as changes in consumer preferences or income.

Accounting Majors

Refers to students who specialize in accounting, studying financial reporting, auditing, tax laws, and financial management in college or university.