Which of the following reasons could explain why the aggregate quantity of output supplied changes? Wages are not sticky. The price level bas risen. People have misperceptions about the price level. Prices are sticky. On the preceding graph, show what happens to the short-run aggregate-supply curve in the long run. (Note: For now, assume there is no change in the long-run aggregate-supply curve.) The aggregate quantity of output demanded eck all that apply. between the short run and the long run because the price level The increase in investment spending might cause the long-run aggregate-supply curve to shift to the increases productivity and output in the future. if it results in a larger capital stock that

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19. Problems and Applications Q10
Suppose an increase in the money supply leads to a fall in interest rates, thereby encouraging firms to invest more.
Show the short-run effect of this change in investment spending on the aggregate-demand curve.
(?)
Price Level
LRAS
Aggregate Supply
Aggregate Demand
Quantity of Output
Aggregate Demand
Aggregate Supply
LRAS
Transcribed Image Text:19. Problems and Applications Q10 Suppose an increase in the money supply leads to a fall in interest rates, thereby encouraging firms to invest more. Show the short-run effect of this change in investment spending on the aggregate-demand curve. (?) Price Level LRAS Aggregate Supply Aggregate Demand Quantity of Output Aggregate Demand Aggregate Supply LRAS
Which of the following reasons could explain why the aggregate quantity of output supplied changes? Check all that apply.
Wages are not sticky.
The price level bas risen.
People have misperceptions about the price level.
Prices are sticky.
On the preceding graph, show what happens to the short-run aggregate-supply curve in the long run. (Note: For now, assume there is no change in
the long-run aggregate-supply curve.)
The aggregate quantity of output demanded
The increase in investment spending might cause the long-run aggregate-supply curve to shift to the
increases productivity and output in the future.
between the short run and the long run because the price level
if it results in a larger capital stock that
Transcribed Image Text:Which of the following reasons could explain why the aggregate quantity of output supplied changes? Check all that apply. Wages are not sticky. The price level bas risen. People have misperceptions about the price level. Prices are sticky. On the preceding graph, show what happens to the short-run aggregate-supply curve in the long run. (Note: For now, assume there is no change in the long-run aggregate-supply curve.) The aggregate quantity of output demanded The increase in investment spending might cause the long-run aggregate-supply curve to shift to the increases productivity and output in the future. between the short run and the long run because the price level if it results in a larger capital stock that
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