Assumption: o Economy begins in long-run equilibrium Long-run equilibrium: o Natural level of output = Q1 o Expected price level - Actual price level = P1 AD and SRAS fluctuations must return to the long-run equilibrium aggregate supply (LRAS) Price level A
Assumption: o Economy begins in long-run equilibrium Long-run equilibrium: o Natural level of output = Q1 o Expected price level - Actual price level = P1 AD and SRAS fluctuations must return to the long-run equilibrium aggregate supply (LRAS) Price level A
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Based on increasing gas prices in the United States
![(c) Using the same graph. How did the country return to long-run equilibrium?
Explain which specific factor(s)4 shifted AD, SRAS, or both, and how they're related
to your event and country. Make sure you explain mention how price and quantity
changed.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F36b8e4b8-06d1-47fa-a6c9-c243eb34c795%2F5f2bdef6-fcc5-4ac5-96f4-ca831bf782e9%2F8p0cku_processed.jpeg&w=3840&q=75)
Transcribed Image Text:(c) Using the same graph. How did the country return to long-run equilibrium?
Explain which specific factor(s)4 shifted AD, SRAS, or both, and how they're related
to your event and country. Make sure you explain mention how price and quantity
changed.
![Chpt 20: Causes of Economic Fluctuations
.
Assumption:
O Economy begins in long-run
equilibrium
. Long-run equilibrium:
O Natural level of output = Q1
O
Expected price level Actual price level P1
AD and SRAS fluctuations must return to the
long-run equilibrium aggregate supply (LRAS)
Price A
1*
level
(
×](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F36b8e4b8-06d1-47fa-a6c9-c243eb34c795%2F5f2bdef6-fcc5-4ac5-96f4-ca831bf782e9%2Fl3euhel_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Chpt 20: Causes of Economic Fluctuations
.
Assumption:
O Economy begins in long-run
equilibrium
. Long-run equilibrium:
O Natural level of output = Q1
O
Expected price level Actual price level P1
AD and SRAS fluctuations must return to the
long-run equilibrium aggregate supply (LRAS)
Price A
1*
level
(
×
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