If the Short-Run Aggregate Supply Curve Is Horizontal, Then The

question 57

Multiple Choice

If the short-run aggregate supply curve is horizontal, then the:

• A) classical dichotomy is satisfied.
• B) money supply cannot affect prices in the short run.
• C) money supply cannot affect output in the short run.
• D) money supply is irrelevant in the short run.

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Definitions:

Structurally Unemployed

Individuals who are unemployed due to changes in the industry they worked in or mismatches between their skills and what employers need.

Unionized

Refers to workers or industries that are organized into unions to collectively negotiate wages and work conditions.

Frictionally Unemployed

Individuals who are temporarily out of work while transitioning between jobs or into the workforce.

Union Membership

Being a part of an organization that represents employees' interests to management regarding wages, work conditions, and other employment terms.