Aggregate Price Level Real GDP demanded Real GDP supplied in the (billions of rupees) short run (billions of rupees) 100 1150 1050 110 1100 1100 120 1050 1150 130 1000 1200 140 950 1250 150 900 1300 160 850 1350 a) Represent the above information in an appropriately labelled diagram. b) What are the short run equilibrium price level and aggregate output? c) Calculate the output gap, and state what type of gap the economy is facing.

Aggregate Price Level Real GDP demanded Real GDP supplied in the (billions of rupees) short run (billions of rupees) 100 1150 1050 110 1100 1100 120 1050 1150 130 1000 1200 140 950 1250 150 900 1300 160 850 1350 a) Represent the above information in an appropriately labelled diagram. b) What are the short run equilibrium price level and aggregate output? c) Calculate the output gap, and state what type of gap the economy is facing.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter26: The Neoclassical Perspective

Section: Chapter Questions

Problem 21P: Use Table 26.3 to answer the following questions. Sketch an aggregate supply and aggregate demand...

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13. The following table shows the initial aggregate supply and demand data for a country. Price Aggregate Aggregate Level Demand Supply 200 10,000 4,000 300 9,000 6,000 400 8,000 8,000 500 7,000 9,000 600 6,000 9,500 700 5,000 9,800 800 4,000 9,900 If input prices rise and AS shifts to the left by 2,000 units at each price level, what output level will equal the new equilibrium price? (A) 6000 (B) 2000 (C) 8000 (D) 7000
Describe the mechanism by which demand creates its own supply.
4. Equilibrium The following table shows the real output demanded and supplied at various price levels in a hypothetical economy. Real Output Demanded (Billions of dollars) 10 20 30 50 80 Price Level (Index number) 160 120 80 40 20 Real Output Supplied (Billions of dollars) 85 80 70 50 20 On the following graph, use the blue points (circle symbol) to plot the aggregate demand (Initial AD) curve for the economy. Then use the orange points (square symbol) to plot the aggregate supply (AS) curve for the economy.
Connect assignment O es Use the following information to draw aggregate demand (AD) and aggregate supply (AS) curves on the following graph. Output Demanded (Aggregate Demand) Output Supplied (Aggregate Demand) Price Level 600 100 Price Level (average price) Instructions: Use the tools provided 'AD' and 'AS' to plot the aggregate demand (AD) and aggregate supply (AS) curves. Plot only the endpoints of each line (plot 2 points for each line-4 points total). Both curves are assumed to be straight lines. 900 800 700 600 500 400 300 200 100 0 0 $700 100 Aggregate Supply and Demand 200 $800 100 900 900 900 900 90 900 900 700 Real Output (quantity per year) Instructions: Enter your response as a whole number. a. What is the equilibrium price level? $ Tools AD D AS e b. What curve (AD or AS) would have shifted if a new equilibrium were to occur at an output level of 600 and a price level of $600? O AS would have shifted to the right. O AS would have shifted to the left. O AD would have…
The following graph shows an increase in aggregate demand (AD) in a hypothetical country. Specifically, aggregate demand shifts to the right from AD¡ to AD2, causing the quantity of output demanded to rise at all price levels. For example, at a price level of 140, output is now $400 billion, wwhere previously it was $300 billion. 170 100 150 140 130 120 AD2 110 AD, 100 00 + 100 200 300 400 500 00 700 800 OUTPUT (Billions of dollars) The following table lists several determinants of aggregate demand. Complete the table by indicating the change needed in each determinant to increase aggregate demand. Change Needed to Increase AD Wealth Тахes Expected rate of return on investment Incomes in other countries PRICE LEVEL
Note: Line segments will automatically connect the points. PRICE LEVEL (Billions of dollars) 200 160 120 0 80 160 240 REAL GDP (Index numbers) The equilibrium price level is 320 400 Initial AD The change in government spending the multiplier effect. SRAS New AD ✓, and the equilibrium level of real output is Suppose that the government spending increases by $16 billion and the expenditure multiplier in this economy is 5. On the previous graph, use the purple points (diamond symbols) to illustrate the effect of the increase in government spending on the aggregate demand (New AD) curve. the equilibrium level of real output by . The price level increase
10. Market equilibrium and disequilibrium The following graph shows the monthly demand and supply curves in the market for calendars. Use the graph input tool to help you answer the following questions. Enter an amount into the Price field to see the quantity demanded and quantity supplied at that price. You will not be scored on any changes you make to this graph. Graph Input Tool Market for Calendars 80 12 I Price (Dollars per calendar) 24 64 Supply 56 Quantity Demanded (Calendars) Quantity Supplied (Calendars) 500 48 40 32 Demand 50 100 150 200 250 300 350 400 450 500 QUANTITY (Calendars) PRICE (Dollars per calendar)
Carefully explain what is happening in the following markets. Indicate the impact if any on demand,supply,price and quantity. Choose answer from the following ; no impact, excess supply,shift inwards to left,increase equilibrium price,shift outwards to right, decrease equilibrium quantity,increase towards equilibrium,increase equilibrium quantity, decrease towards equilibrium, change in quantity uncertain, excess demand,decrease equilibrium,change in price uncertain 1d) Electricity is a major input the production of aluminum,and aluminum is substitute in supply for steal ,the effect of an increase in price of electricity.
The accompanying table shows the aggregate demand and aggregate supply schedules for a hypothetical economy. Real Domestic Output Supplied (in Billions) $9,000 Price Level (Index Value) Real Domestic Output Demanded (in Billions) $3,000 4,000 5,000 350 8,000 5,000 7,000 300 250 6,000 200 7,000 150 5,000 8,000 100 4,000 a. What is the equilibrium price and output levels? b. If the price level is 350, what will happen in the economy? why? (.
2. Equilibrium The following table shows the real output demanded and supplied at various price levels in a hypothetical economy. Real Output Demanded Price Level Real Output Supplied (Billions of dollars) (Billions of dollars) (Index number) (Billions of dollars) 10 160 85 20 120 80 30 80 70 50 40 50 80 20 20
Suppose that the aggregate demand and aggregate supply schedules for a hypothetical economy are as shown in the following table: Amount of Real GDP Demanded $ 600 $ 700 $ 800 $ 900 $1000 Price Amount of Real GDP Supplied $500 $1200 $400 $1000 $300 $200 $100 $ 800 $ 600 $ 400 a. Use the above data to graph the aggregate supply and aggregate demand curves. b. What are the equilibrium price and equilibrium level of real GDP? C. When this economy reaches its equilibrium GDP in this example, is it also operating at potential GDP? Explain why or why not.
Supply and Demand Schedules for PlayStation5 - Digital Edition P in USD Quantity Demanded Quantity Supplled 100 900 100 200 700 150 300 500 225 400 300 300 500 100 400 600 475 Use the information in the supply and demand schedules above to plot the supply and demand curves, and then answer the following questions. What would happen if Sony, the producers of the PS5, set the price of the PS5 arbitrarily at 500 dollars each, Instead of 400 dollars each? O a There would be a shortage of PS5S, because the quantity demanded at that price is greater than the quantity supplied. O b There would be a decrease in the demand for PS5S. There would be a surplus of PS5S, because the quantity supplied at that price is greater than the quantity demanded. There would be an increase in the demand for PS5S.