Chapter 33 - Aggregate Demand and Aggregate Supply

Real GDP

Real GDP

________ is commonly used to watch short- run changes in the economy.

Stagflation

________: a period of falling outputs and rising prices.

stickiness of wages

The ________ provides an incentive to produce less output (when the price level is lower) and more output (when the price level is higher)

Technology

________ and monetary policy are the two most important influencers of the economy in practice.

quantity of output

The ________ supplied deviates from its long- run (natural) level when the actual price level in the economy deviates from the price level that people expect to sell best.

larger quantity of goods

The increase in consumer spending relates to a(n) ________ and services demanded.

price level

The short- run fluctuations in output and the ________ can be viewed as deviations from the long- run trends of output growth and inflation.

Price Level

The ________ and Net Exports (The Exchange- Rate Effect): When a fall in the US ________ causes US interest rates to fall, the real value of the dollar declines in foreign exchange markets.