Answer to Question #200067 in Macroeconomics for Sima

Question

Which one of the following statements is correct?

a. Production will only increase in response to an increase in expenditure (demand) if the price level decreases.

b. Higher oil price’s will result in a leftward shift of the AD,ASSR, ASLR curves

c. When actual prices are higher than expected prices, the ASSR curve will eventually shift to the right

d. Structural unemployment is due to certain number of people who are in the process of changing jobs or careers

Answer 1

a) Production will only increase in response to an increase in expenditure (demand) if the price level decreases.