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An article in the New York Times in early 2015 stated that economists at the Federal Reserve were forecasting that "real GDP would expand at a faster pace than potential output in 2015 and that the inflation rate during 2015 would be about 1 percent. Source: Reuters, "Factbox: Fed Staff Forecasts From FOMC Minutes," New York Times, April 8, 2015. Fill in the missing values in the table with estimates that are consistent with these forecasts. Assume that the growth rate for real GDP between 2015 and 2016 is 0.21 percentage points higher than the percentage change in potential output between those years (rounded to two decimal places). Real GDP Potential GDP GDP Deflator (Enter your responses rounded to one decimal place.) Use a dynamic aggregate demand and aggregate supply graph to explain your calculations. The long-run aggregate supply curve will shift to the The aggregate demand and short-run aggregate supply curves will OA. shift to the right but by more than the long-run aggregate supply curve. OB. shift to the right but by less than the long-run aggregate supply curve. OC. shift to the right by the same amount as the long-run aggregate supply curve. OD. not shift. 2015 $16.7 trillion $16.8 trillion 119.2 2016 S trillion $17.1 trillion ☐

An article in the New York Times in early 2015 stated that economists at the Federal Reserve were forecasting that "real GDP would expand at a faster pace than potential output in 2015 and that the inflation rate during 2015 would be about 1 percent. Source: Reuters, "Factbox: Fed Staff Forecasts From FOMC Minutes," New York Times, April 8, 2015. Fill in the missing values in the table with estimates that are consistent with these forecasts. Assume that the growth rate for real GDP between 2015 and 2016 is 0.21 percentage points higher than the percentage change in potential output between those years (rounded to two decimal places). Real GDP Potential GDP GDP Deflator (Enter your responses rounded to one decimal place.) Use a dynamic aggregate demand and aggregate supply graph to explain your calculations. The long-run aggregate supply curve will shift to the The aggregate demand and short-run aggregate supply curves will OA. shift to the right but by more than the long-run aggregate supply curve. OB. shift to the right but by less than the long-run aggregate supply curve. OC. shift to the right by the same amount as the long-run aggregate supply curve. OD. not shift. 2015 $16.7 trillion $16.8 trillion 119.2 2016 S trillion $17.1 trillion ☐

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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An article in the New York Times in early 2015 stated that economists at the Federal Reserve were forecasting that "real GDP would expand at a faster pace than potential output in 2015 and that the inflation rate during 2015 would be about 1 percent. Source: Reuters, "Factbox: Fed Staff Forecasts From FOMC Minutes," New York Times, April 8, 2015. Fill in the missing values in the table with estimates that are consistent with these forecasts. Assume that the growth rate for real GDP between 2015 and 2016 is 0.21 percentage points higher than the percentage change in potential output between those years (rounded to two decimal places). Real GDP Potential GDP GDP Deflator (Enter your responses rounded to one decimal place.) Use a dynamic aggregate demand and aggregate supply graph to explain your calculations. The long-run aggregate supply curve will shift to the The aggregate demand and short-run aggregate supply curves will A. shift to the right but by more than the long-run aggregate supply curve. OB. shift to the right but by less than the long-run aggregate supply curve. OC. shift to the right by the same amount as the long-run aggregate supply curve. OD. not shift. 2015 $16.7 trillion $16.8 trillion 119.2 2016 $ trillion $17.1 trillion ||
Transcribed Image Text:An article in the New York Times in early 2015 stated that economists at the Federal Reserve were forecasting that "real GDP would expand at a faster pace than potential output in 2015 and that the inflation rate during 2015 would be about 1 percent. Source: Reuters, "Factbox: Fed Staff Forecasts From FOMC Minutes," New York Times, April 8, 2015. Fill in the missing values in the table with estimates that are consistent with these forecasts. Assume that the growth rate for real GDP between 2015 and 2016 is 0.21 percentage points higher than the percentage change in potential output between those years (rounded to two decimal places). Real GDP Potential GDP GDP Deflator (Enter your responses rounded to one decimal place.) Use a dynamic aggregate demand and aggregate supply graph to explain your calculations. The long-run aggregate supply curve will shift to the The aggregate demand and short-run aggregate supply curves will A. shift to the right but by more than the long-run aggregate supply curve. OB. shift to the right but by less than the long-run aggregate supply curve. OC. shift to the right by the same amount as the long-run aggregate supply curve. OD. not shift. 2015 $16.7 trillion $16.8 trillion 119.2 2016 $ trillion $17.1 trillion ||
Furthermore, the demand curve will shift to the right by The new short-run equilibrium will be where than the short-run aggregate supply curve. O A. the new aggregate demand curve intersects the new short-run aggregate supply curve, on the new long-run aggregate supply curve. O B. the new aggregate demand curve intersects the new short-run aggregate supply curve, to the right of the new long-run aggregate supply curve. O c. the new aggregate demand curve intersects the new short-run aggregate supply curve, on the original long-run aggregate supply curve. O D. the new aggregate demand curve intersects the new short-run aggregate supply curve, to the left of the new long-run aggregate supply curve.
Transcribed Image Text:Furthermore, the demand curve will shift to the right by The new short-run equilibrium will be where than the short-run aggregate supply curve. O A. the new aggregate demand curve intersects the new short-run aggregate supply curve, on the new long-run aggregate supply curve. O B. the new aggregate demand curve intersects the new short-run aggregate supply curve, to the right of the new long-run aggregate supply curve. O c. the new aggregate demand curve intersects the new short-run aggregate supply curve, on the original long-run aggregate supply curve. O D. the new aggregate demand curve intersects the new short-run aggregate supply curve, to the left of the new long-run aggregate supply curve.
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