7. As shown in the diagram to the right, the short-run aggregate supply curve (AS) is upward-sloping. This positive slope is explained in part by the fact that A. input price increases cause firms to raise their prices. B. in the short-run, output prices are slower to adjust to increasing aggregate demand than are input prices. C. in the short-run, input prices particularly wage rates-are slower to adjust to increasing aggregate demand than are output prices. D. business owners are more intelligent than other resource owners. A. The AS curve shifts rightward. B. The AS curve remains unchanged. C. The AS curve becomes horizontal. D. The AS curve shifts leftward. Price level, P 8. How would the following event impact the economy's short-run aggregate supply (AS) curve? Event: High taxes and excessive regulation cause firms to reduce the quantity of their physical capital. Aggregate output (income), Y A. increase and therefore shift to the left B. increase and therefore shift to the right C. decrease and therefore shift to the right D. decrease and therefore shift to the left AS 9. A negative supply shock, such as an increase in oil prices, causes the short-run aggregate supply curve to

ENGR.ECONOMIC ANALYSIS
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Author:NEWNAN
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Chapter1: Making Economics Decisions
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7. As shown in the diagram to the right, the short-run
aggregate supply curve (AS) is upward-sloping. This
positive slope is explained in part by the fact that
A. input price increases cause firms to raise
their prices.
B. in the short-run, output prices are slower
to adjust to increasing aggregate demand
than are input prices.
C. in the short-run, input
prices particularly wage rates-are
slower to adjust to increasing aggregate
demand than are output prices.
D. business owners are more intelligent than
other resource owners.
A. The AS curve shifts rightward.
B. The AS curve remains unchanged.
C. The AS curve becomes horizontal.
D. The AS curve shifts leftward.
Price level, P
8. How would the following event impact the economy's short-run aggregate supply (AS) curve?
Event: High taxes and excessive regulation cause firms to reduce the quantity of their physical capital.
Aggregate output (income), Y
A. increase and therefore shift to the left
B. increase and therefore shift to the right
C. decrease and therefore shift to the right
D. decrease and therefore shift to the left
AS
9. A negative supply shock, such as an increase in oil prices, causes the short-run aggregate supply curve to
Transcribed Image Text:7. As shown in the diagram to the right, the short-run aggregate supply curve (AS) is upward-sloping. This positive slope is explained in part by the fact that A. input price increases cause firms to raise their prices. B. in the short-run, output prices are slower to adjust to increasing aggregate demand than are input prices. C. in the short-run, input prices particularly wage rates-are slower to adjust to increasing aggregate demand than are output prices. D. business owners are more intelligent than other resource owners. A. The AS curve shifts rightward. B. The AS curve remains unchanged. C. The AS curve becomes horizontal. D. The AS curve shifts leftward. Price level, P 8. How would the following event impact the economy's short-run aggregate supply (AS) curve? Event: High taxes and excessive regulation cause firms to reduce the quantity of their physical capital. Aggregate output (income), Y A. increase and therefore shift to the left B. increase and therefore shift to the right C. decrease and therefore shift to the right D. decrease and therefore shift to the left AS 9. A negative supply shock, such as an increase in oil prices, causes the short-run aggregate supply curve to
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