Reduction in the levels of structural unemployment have the effect of A. Reducing the level of aggregate demand. B. Increasing the level of frictional unemployment (since if structural unemployment falls frictional unemployment must rise to keep the natural rate unchanged) C. Reducing the long-run aggregate supply but increasing short-run aggregate supply D. Increasing the long-run aggregate supply
Reduction in the levels of structural unemployment have the effect of A. Reducing the level of aggregate demand. B. Increasing the level of frictional unemployment (since if structural unemployment falls frictional unemployment must rise to keep the natural rate unchanged) C. Reducing the long-run aggregate supply but increasing short-run aggregate supply D. Increasing the long-run aggregate supply
Chapter10: Aggregate Supply
Section: Chapter Questions
Problem 1.1P
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Reduction in the levels of structural unemployment have the effect of
Reducing the level of aggregate demand.
Increasing the level of frictional unemployment (since if structural unemployment falls frictional unemployment must rise to keep the natural rate unchanged)
Reducing the long-run aggregate supply but increasing short-run aggregate supply
Increasing the long-run aggregate supply
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