AS

Question 1

Only ________ cause movements

external factors cause _____

Answer 1

prices levels

shifts

Question 2

certainty
uncertainty

Answer 2

positive expectations
negative expectations

Question 3

Business men will make more INFORMED choices with ________&_________

Answer 3

certainty & expectations

Question 4

aggregate supply

Answer 4

refers to the TOTAL SUPPLY of goods & services in an economy.

Question 5

SRAS

Answer 5

upward sloping
+ price levels= +supply
-price levels= -supply

Question 6

3 shifters of SRAS

Answer 6

1. Price of resources (Factors of production)
2. government actions/policies
3. productivity changes (technology)

Question 7

capital stock

supply shocks

Answer 7

refers to physical capital (tools, machines, etc.)

Unexpected changes in the price or availability of KEY RESOURCES.

Question 8

LRAS

Answer 8

is vertical, representing full employment & maximum sustainable output.

ONLY EXPECTED price level changes CAN affect the LRAS.

Question 9

In LRAS
when the PPF shifts outwards it means ____________

when the PPF shifts inwards it means ____________

Answer 9

LRAS shifts outwards

LRAS shifts inwards

Question 10

long run is compromised of ________ choices

Answer 10

short term

Question 11

the only thing that can shift the PPF is ?

Answer 11

efficiency with resources