Aggregate Supply Quiz Questions

13 Questions | Total Attempts: 153

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Aggregate Supply Quizzes & Trivia

Questions and Answers
  • 1. 
    The definition of aggregate supply is: 
    • A. 

      The definition of aggregate supply is:

    • B. 

      The total amount of goods and services in an economy.

    • C. 

      The sum of goods and services in the short run.

  • 2. 
    1.       What does the aggregate supply curve show?
    • A. 

      The total demand for goods and services in an economy

    • B. 

      The supply of services in an economy

    • C. 

      The total supply of goods and services in an economy

  • 3. 
    1.       What is the slope of the short-run aggregate supply curve?
    • A. 

      Downward

    • B. 

      Upward

    • C. 

      Vertical

  • 4. 
    1.       What is the slope of the long-run aggregate supply curve?
    • A. 

      Upward

    • B. 

      Vertical

    • C. 

      Horizontal

  • 5. 
    1.       What will cause the LRAS curve to shift to the right?
    • A. 

      The LRAS curve will shift to the right if there is an improvement in the quality of the factors of production or an increase in the quantity of the factors of production

    • B. 

      The LRAS curve will shift to the right if there is a decrease in the quality of the factors of production or an increase in the quantity of the factors of production.

    • C. 

      The LRAS curve will shift to the right if there is an improvement in the quality of the factors of production or an decrease in the quantity of the factors of production

  • 6. 
    1.       The overarching goal of supply side policies is:
    • A. 

      To decrease the potential output of the economy by increasing the quantity of the factors of production and or improving the quality of the factors of production

    • B. 

      To increase the potential output of the economy by decreasing the quantity of the factors of production improving the quality of the factors of production

    • C. 

      To increase the potential output of the economy by increasing the quantity of the factors of production and or improving the quality of the factors of production

  • 7. 
    1.       If taxes are reduced, it is hoped that:
    • A. 

      The will be less incentive for labor to work harder and to become more productive.

    • B. 

      There will be greater incentive for labor to work harder and to become more productive

    • C. 

      There will be no effect in the incentive for labor to work harder and to become more productive.

  • 8. 
    1.       If businesses’ taxes are reduced:
    • A. 

      They will have less incentive to produce efficiently

    • B. 

      Their production will not be affected

    • C. 

      They will have more incentive to produce efficiently

  • 9. 
    1.       A reduction in trade union power will:
    • A. 

      Reduce the ability of unions to negotiate high wages and therefore lower the costs of production to firms, thus increasing their potential output.

    • B. 

      Increase the ability of unions to negotiate high wages and therefore lower the costs of production to firms, thus increasing their potential output.

    • C. 

      Reduce the ability of unions to negotiate high wages, therefore increasing the costs of production, and decreasing their potential output.

  • 10. 
    1.       If governments have placed many regulations on the operations of business, then this may:
    • A. 

      Decrease their costs of production, and increase aggregate supply

    • B. 

      Increase their costs of production, and reducing aggregate supply

    • C. 

      Decreasing their costs of production, and decreasing aggregate supply

  • 11. 
    1.       Privately owned profit-maximizing firms will be:
    • A. 

      Efficiency will not be affected.

    • B. 

      Much less efficient and productive than government run firms.

    • C. 

      Much more efficient and productive than government run firms.

  • 12. 
    1.       How many phases are in the Keynesian LRAS curve?
    • A. 

      1

    • B. 

      2

    • C. 

      3

  • 13. 
    1.       In the last phase of the Keynesian LRAS curve, it is impossible to:
    • A. 

      Decrease output

    • B. 

      Increase output

    • C. 

      Output doesn’t change

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