Self-control test

1) Business cycles are

	fluctuations in actual GDP around potential GDP
	fluctuations in potential GDP around actual GDP
	fluctuations in aggregate demand
	fluctuations in aggregate supply

2) Business cycles are caused by

3) When GDP is below its potential level, wages have tendency to

4) When GDP is above its potential level

	it is relatively easy to find a job
	it is relatively difficult to find a job
	people are not willing to work

5) Decrease in wage rates

	increases aggregate supply
	decreases aggregate supply
	does not affect aggregate supply

6) When aggregate demand increases, in the long run

	unemployment increases
	unemployment decreases
	unemployment remains constant

7) When aggregate supply decreases, in the short run

	unemployment increases
	unemployment decreases
	unemployment remains constant

8) Why producers increase their production in the short run under increasing price level?

	Due to fixed factor prices in the short run this increases their profits
	Due to decreasing factor prices in the short run this increases their profits
	Due to higher unemployment in the short run this increases their profits