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an article in the Economist magazine noted​ that: ​"the economy's potential to supply goods and services​ [is] determined by such things as labour force and capital​ stock, as well as inflation​ expectations." ​Source:"Money's Muddled​ Message" Economist​, May​ 19, 2009. This list of the determinants of potential GDP is A. correct since changes in the expected price level affect both the short run and the long run aggregate supply. B. incorrect since changes in the expected price level affect short run aggregate supply but not the long run aggregate supply. C. correct since changes in the expected price level affect short run aggregate supply which in turn determines potential GDP. D. incorrect since changes in the expected price level do not affect aggregate supply.

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Answer:

B. incorrect since changes in the expected price level affect short run aggregate supply but not the long run aggregate supply

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