QUESTION 1AggregatedemandA. upward slopingO B. downward slopingC. verticalD. horizontalcurveis

Aggregate demand refers to the total demand for commodities and services made by all the economic…

Answered: Aggregate demand O A. upward sloping O…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Consumer Spending increased by 5% last month. Based on this data, which of the following will likely occur in the next 3 -6 months? O GDP will increase O Unemployment will increase O The economy will enter a trough O Stagflation will occur
Why does an inflationary output gap lead to increased price levels? O a. Demand is too high O b. Capital and labor are fixed in the short-run O C. Potential GDP is too low O d. The government increases price levels Supply is too low
An increase in investment causes the price level to O A. decrease; decrease further OB. increase; decrease O C. increase; increase further O D. decrease; increase in the short run and in the long run. ...
Possitive short run relatioship between the prices level for outpput and reall gdp holding the prices of inputs fexed a- longo-run aggregate supply SRAS curve b- long run aggregate demand SRAS curve c- short eun aggregate supply SRAS curve d- short-run aggregate demand SRAS curve
Which is NOT neutral in the long run? O output O aggregate demand O money real interest rates
Price Level O B Price Level Quantity of Output Quantity of Output Refer to the Figure 14-1. In the short run, what would result from a favourable shift in aggregate supply? O a. It would move the economy from A to B. O b. It would move the economy from B to C. Oc. It would move the economy from C to D. O d. It would move the economy from D to A.
Suppose an economy is in long-run equilibrium. The central bank reduces the money supply by 5 percent. Use your diagram to show what happens to output and the price level as the economy moves from the initial to the new short-run equilibrium. Price Level LRAS Aggregate Supply Aggregate Demand Quantity of Output Now adjust the graph to show the new long-run equilibrium. Aggregate Demand Aggregate Supply What causes the economy to move from its short-run equilibrium to its long-run equilibrium? O The government increases taxes to curb aggregate demand. Nominal wages, prices, and perceptions adjust upward to this new price level. O The government increases spending to increase aggregate demand. O Nominal wages, prices, and perceptions adjust downward to this new price level. Which of the following is true according to the sticky-wage theory of aggregate supply as a result of the decrease in the money supply? Check all that apply. Nominal wages at the initial equilibrium are equal to…
The total amount of goods and services that firms are willing and able to sell at a given price level in an economy is O a. Aggregate supply O b. None c. Full employment С. O d. Keynesian Theory e. Aggregate Demand
How do prices change due to an economic contraction that is caused by a shift in aggregate demand? O a. They rise in the short run and fall back to their original level in the long run. b. They fall in the short run and fall even more in the long run. c. They rise in the short run and rise even more in the long run. d. They fall in the short run and rise back to their original level in the long run.

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Aggregate demand O A. upward sloping O O c. vertical O D. horizontal B. downward sloping curve is