Question

QUESTION 11

1. Event:  Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in aggregate demand?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

QUESTION 12

1. Event: Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in short run aggregate supply?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

QUESTION 13

1. Event: Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in long run aggregate supply (LRAS)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

QUESTION 14

1. Event: Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in equilibrium price level?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

QUESTION 15

1. Event: Universal K-12 education provides everyone a chance to go to school. (Short Run)

   Question: What is the change in equilibrium real gross domestic product (RGDP)?

   	a.	Increase
   	b.	Decrease
   	c.	No change
   	d.	Indeterminate

Answer 1

Q11. Option c. With the opportunity of schooling the earning potential increases because of increase in skill sets but it would take some time to reflect on aggregate demand in short run
Q12. Option c.
Q13. Option a. As in long run because of increased earning potential, the demand increases and hence the supply too increases
Q14. Option c. As in short run the demand and supply would not change, the equilibrium price level too would not change
Q15. Option c.