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AP Macroeconomics Mod 2 D Explain Using Graphs As Appropriate How Movement Along the Sras Curve Implies a Relationship Between the Price Level and Questions

Link movement along SRAS to the short-run price-level and unemployment trade-off, including why sticky downward wages make lower AD reduce output and jobs.

Syllabus
Effective Fall 2022
Course
AP Macroeconomics

Exam points

  • explain how sticky downward wages or prices make lower AD reduce output and raise short-run unemployment

AP Macroeconomics Mod 2 D Explain Using Graphs As Appropriate How Movement Along the Sras Curve Implies a Relationship Between the Price Level and Questions question 1

[Maximum number: 1]

A reduction in aggregate demand will necessarily cause an increase in unemployment in the short run when

A

nominal wages or prices are sticky downward

B

nominal wages and prices are flexible

C

the aggregate supply curve is vertical

D

the money supply grows at a constant rate

E

imports exceed exports

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