This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Aggregate > Aggregate Supply – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Aggregate Supply Quiz 1 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The three principal sections on the Keynesian LRAS curve A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 2. Changes in the costs of production cause the short run aggregate supply curve to shift A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 3. A rise in the overall price level A) Inflation. B) GDP. C) Aggregate Supply. D) Market Basket. Show Answer Correct Answer: A) Inflation. 4. Suppose that nominal wages fall and productivity rises in a particular economy. Other things equal, the aggregate: A) Demand curve will shift leftward. B) Supply curve will shift rightward. C) Supply curve will shift leftward. D) Expenditures curve will shift downward. Show Answer Correct Answer: B) Supply curve will shift rightward. 5. There are two types of neoclassical aggregate supply curves A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 6. LRAS is likely to increase if: A) AD increases. B) The pound increases in value. C) Corporation tax increases. D) Investment increases. Show Answer Correct Answer: D) Investment increases. 7. The pound appreciates in value. The likely effect is: A) Net exports increase. B) Net exports fall. C) LRAS increases. D) Government spending falls. Show Answer Correct Answer: B) Net exports fall. 8. An improvement in the quality of the factors of production and the quantity can shift the long run aggregate supply curve to the right A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 9. The accelerator effect can be positive or negative. A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 10. Nonworking people who are capable of working but have given up looking for a job due to the state of the job market A) Discouraged Workers. B) Underemployed Workers. C) Labor Force. D) Market Basket. Show Answer Correct Answer: A) Discouraged Workers. 11. The reasons for why aggregate demand curve might shift to the right A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 12. A rise in the price level will cause output to fall because domestic consumption will be reduced A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 13. A rise in the price level will cause output to fall because the demand for exports will be reduced A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 14. The long run aggregate supply curve assumes all resources are being used to full capacity A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 15. The short-run aggregate supply curve is upward sloping A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 16. Shows the relationship between the aggregate price level and the quantity of aggregate output demanded by households, business, the government, and the rest of the world A) Aggregate Supply. B) Aggregate Demand. C) CPI. D) GDP. Show Answer Correct Answer: B) Aggregate Demand. 17. Something that makes people want to produce more goods and services A) Incentives. B) Inflation. C) GDP. D) Macroeconomics. Show Answer Correct Answer: A) Incentives. 18. Improved training of employees would: A) Shift aggregate supply outwards at each price. B) Shift aggregate supply inwards at each price. C) Shift aggregate demand outwards at each price. D) Shift aggregate demand inwards at each price. Show Answer Correct Answer: A) Shift aggregate supply outwards at each price. 19. A rise in GDP might cause an accelerated increase in investment. This is known as the accelerator effect. A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 20. Which of the following would NOT shift LRAS? A) If 1 million immigrants come to America. B) Decrease in investment spending. C) Increase in technology. D) Increase in capital stock. Show Answer Correct Answer: B) Decrease in investment spending. 21. Shows the relationship between the aggregate price level and the quantity of aggregate output supplied in the economy A) Aggregated Supply. B) Aggregated Demand. C) Budget. D) Labor force. Show Answer Correct Answer: A) Aggregated Supply. 22. The multiplier effect leads to a larger increase in aggregate demand A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 23. An investment will be more likely if: A) If the interest rates are high. B) Confidence in the market is low. C) If interest rates are low. D) The economy is operating with excess capacity. Show Answer Correct Answer: C) If interest rates are low. 24. The price level represents the average price level in the UK, i.e. the consumer price index A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 25. Real GDP divided by population size A) GDP. B) Real GDP per Capita. C) Nominal GDP. D) Real GDP. Show Answer Correct Answer: B) Real GDP per Capita. 26. The SRAS curve can be price inelastic or price elastic, and I recognize the significance of this. A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 27. The price of oil decreases. This will most likely: A) Cause AS to contract. B) Cause an increase in AD. C) Cause AS to shift to the left. D) Cause AS to shift to the right. Show Answer Correct Answer: D) Cause AS to shift to the right. 28. Banks can play a part in determining the position of the long run aggregate supply curve through affecting investment A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 29. The outward shift of the AS curve means that at any given price level, more output can be produced A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. 30. A rise in the price level will cause output to fall because the demand for imports will increase A) Yes, I understand this from the notes. B) No, I don't understand this from the notes. C) No, I don't understand this, as I have not read the notes. D) None of above. Show Answer Correct Answer: A) Yes, I understand this from the notes. Next →Related QuizzesMacroeconomics QuizzesEconomics QuizzesAggregate Supply Quiz 2Aggregate Demand Quiz 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books