Economics Chapter 13

Question 1

aggregate supply

Answer 1

total supply of goods & services in an economy

Question 2

aggregate supply curve

Answer 2

shows the relationship between the aggregate quantity of output supplied by all firms in an economy & the overall price level

Question 3

AS shift right

Answer 3

larger aggregate output at given price level

Question 4

cost shock, supply shock

Answer 4

change in costs that shifts the short-run aggregate supply curve

Question 5

Equilibrium Price Level

Answer 5

price level at which aggregate demand and aggregate supply curves intersect

Question 6

potential output or potential GDP

Answer 6

level of aggregate output that can be sustained in the long run w/out inflation

Question 7

fiscal policy variables

Answer 7

government expenditure & taxes

Question 8

monetary policy variable

Answer 8

money supply

Question 9

demand-pull inflation

Answer 9

inflation initiated by increase in aggregate demand

Question 10

cost push, supply-side inflation

Answer 10

inflation caused by increase in costs

Question 11

stagflation

Answer 11

output is falling at the same time that prices are rising