Question

1. The short-run aggregate supply curve shows:

Answer 1

Answer: The answer is provided below

Explanation:

1. The short-run aggregate supply curve shows: The relationship between the price level and aggregate expenditure.

The short run aggregate supply curve also referred to as the upward sloping aggregate supply indicates the positive relationship that is between the price level and the real GDP during the short run.

2. Which of the following are assumed to remain unchanged along a given short-run aggregate supply curve?

Institutions, such as patent laws and tax systems, that make up the "rules of the game."

The institutions that make up the rule of the game will not change easily. Those that can change easily in the short run are price level, the aggregate demand curve, and resource.

3. The term short-run macroeconomic equilibrium refers to: The situation when the quantity of aggregate output supplied is equal to the quantity demanded

The short-run macroeconomic equilibrium is a situation that is achieved when the aggregate demand i.e total demand and the aggregate supply i.e total supply are both equal in the short term.

4. In macroeconomics, the term long run refers to: A period of time long enough for all input prices and wages to be renegotiated.

The long-run is a period of time whereby all the factors of production and the costs are variable. Firms in the long run will be able to adjust their costs.