Long-Run Aggregate Supply Curve (LAS) Quiz

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Questions and Answers

How does the long-run aggregate supply curve (LAS) behave in response to changes in the price level?

  • It remains fixed (correct)
  • It shifts vertically
  • It shifts horizontally
  • It becomes steeper

What does a vertical long-run aggregate supply curve (LAS) indicate about an economy?

  • Excessive unemployment and low production capacity
  • Scarce resources and high production capacity (correct)
  • Excessive inflation and low production capacity
  • Unlimited resources and unlimited production capacity

How does the long-run aggregate supply curve (LAS) differ from the short-run aggregate supply curve (SAS)?

  • LAS shifts with changes in price level, SAS does not
  • SAS is horizontal and LAS is vertical
  • SAS is vertical and LAS is horizontal
  • SAS shifts with changes in price level, LAS does not (correct)

The subprime mortgage crisis was a significant event in the financial industry?

<p>True (A)</p> Signup and view all the answers

The long-run aggregate supply curve (LAS) is different from the short-run aggregate supply curve (SAS)?

<p>True (A)</p> Signup and view all the answers

A vertical long-run aggregate supply curve (LAS) indicates a stable economy?

<p>True (A)</p> Signup and view all the answers

Changes in the price level do not affect the long-run aggregate supply curve (LAS)?

<p>False (B)</p> Signup and view all the answers

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