Question

1. vent: Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in long run aggregate supply (LRAS)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 14

1. Event: Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in equilibrium price level?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 15

1. Event: Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in equilibrium real gross domestic product (RGDP)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 16

1. Event: Firms expect the price of oil will rise in the future due to unrest in the Middle East. (Long Run)

   Question: What is the change in aggregate demand (AD)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 17

1. Event: Firms expect the price of oil will rise in the future due to unrest in the Middle East. (Long Run)

   Question: What is the change in short run aggregate supply (SRAS)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 18

1. Event: Firms expect the price of oil will rise in the future due to unrest in the Middle East. (Long Run)

   Question: What is the change in long run aggregate supply (LRAS)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 19

1. Event: Firms expect the price of oil will rise in the future due to unrest in the Middle East. (Long Run)

   Question: What is the change in equilibrium price level?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 20

1. Event: Firms expect the price of oil will rise in the future due to unrest in the Middle East. (Long Run)

   Question: What is the change in equilibrium real gross domestic product (RGDP)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 21

1. Event: Decrease in government spending due to concerns about increasing debt. (Long Run)

   Question: What is the change in aggregate demand (AD)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 22

1. Event: Decrease in government spending due to concerns about increasing debt. (Long Run)

   Question: What is the change in short run aggregate supply (SRAS)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 23

1. Event: Decrease in government spending due to concerns about increasing debt. (Long Run)

   Question: What is the change in long run aggregate supply (LRAS)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 24

1. Event: Decrease in government spending due to concerns about increasing debt. (Long Run)

   Question: What is the change in equilibrium price level?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

3 points   

QUESTION 25

1. Event: Decrease in government spending due to concerns about increasing debt. (Long Run)

   Question: What is the change in equilibrium real gross domestic product (RGDP)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

Answer 1

13.

A

Chance to go to school, is the part of human capital development and it increases the productivity level. It will cause LRAS to shift to the right and increase.

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14.

B

Price level will decrease as SRAS will shift to the right. So, output increases and price decreases at the new equilibrium.

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15.

A

Real GDP is going to increase at the new equilibrium as SRAS will shift to the right.

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16.

C

AD will not change, rather it will affect the SRAS.

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17.

B

The event works as a negative supply shock and it makes SRAS to decrease and shift to the left.

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18.

C

LRAS will not change, because rise in oil price is a short run phenomenon.

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19.

A

Price level will increase due to the negative supply shock.

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20.

B

Real GDP will decrease due to the higher price and negative supply shock.

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21.

B

AD curve will shift to the left, and AD will decrease.

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22.

C

SRAS will not change, as government spending affects AD.

===

23.

C

LRAS will not change.

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24.

B

Price level decreases with decrease in government spending as AD curve shifts to the left.

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25.

B

Real GDP decreases due to the decrease in government spending as AD curve shifts to the left.