Principles of Economics 2e 2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: Steven A. Greenlaw; David Shapiro
1 Welcome To Economics! 2 Choice In A World Of Scarcity 3 Demand And Supply 4 Labor And Financial Markets 5 Elasticity 6 Consumer Choices 7 Production, Costs, And Industry Structure 8 Perfect Competition 9 Monopoly 10 Monopolistic Competition And Oligopoly 11 Monopoly And Antitrust Policy 12 Environmental Protection And Negative Externalities 13 Positive Externalities And Public Goods 14 Labor Markets And Income 15 Poverty And Economic Inequality 16 Information, Risk, And Insurance 17 Financial Markets 18 Public Economy 19 The Macroeconomic Perspective 20 Economic Growth 21 Unemployment 22 Inflation 23 The International Trade And Capital Flows 24 The Aggregate Demand/aggregate Supply Model 25 The Keynesian Perspective 26 The Neoclassical Perspective 27 Money And Banking 28 Monetary Policy And Bank Regulation 29 Exchange Rates And International Capital Flows 30 Government Budgets And Fiscal Policy 31 The Impacts Of Government Borrowing 32 Macroeconomic Policy Around The World 33 International Trade 34 Globalization And Protectionism A The Use Of Mathematics In Principles Of Economics B Indifference Curves C Present Discounted Value D The Expenditure-output Model Chapter24: The Aggregate Demand/aggregate Supply Model
Chapter Questions Section: Chapter Questions
Problem 1SCQ: Describe the mechanism by which supply creates its osi1 demand. Problem 2SCQ: Describe the mechanism by which demand creates its own supply. Problem 3SCQ: The short run aggregate supply curve was constructed assuming that as the price of outputs... Problem 4SCQ: In the AD/AS model, what prevents the economy from achieving equilibrium at potential output? Problem 5SCQ: Suppose the U.S. Congress passes significant immigration reform that makes it more difficult for... Problem 6SCQ: Suppose concerns about the size of the federal budget deficit lead the U.S. Congress to cut all... Problem 7SCQ: How would a dramatic increase in the value of the stock market shift the AD curve? What effect would... Problem 8SCQ: Suppose Mexico, one of our largest trading partners and purchaser of a large quantity of our... Problem 9SCQ: A policymaker claims that tax cuts led the economy out of a recession. Can we use the AD/AS diagram... Problem 10SCQ: Many financial analysts and economists eagerly await the press releases for the reports on the home... Problem 11SCQ: What impact would a decrease in the size of the labor force have on GDP and the puce level according... Problem 12SCQ: Suppose, after five years of sluggish growth, the European Unions economy picks up speed. What would... Problem 13SCQ: Suppose the Federal Reserve begins to Increase the supply of money at an Increasing rate. What... Problem 14SCQ: If the economy is operating in the neoclassical zone of the SRAS curve and aggregate demand falls,... Problem 15SCQ: If the economy is operating In the Keynesian zone of the SRAS curve and aggregate demand falls, what... Problem 16RQ: What is says law? Problem 17RQ: What is Keynes; law? Problem 18RQ: Do neoclassical economists believe in Keynes law or Says law? Problem 19RQ: Does Says law apply more accurately in the long run or the short run? What about Keynes law? Problem 20RQ: What is on the horizontal axis of the AD/AS diagram? What is on the vertical axis? Problem 21RQ: What is the economic reason why the SRAS curve slopes up? Problem 22RQ: What are the components of the aggregate demand (AD) curve? Problem 23RQ: What are the economic reasons why the AD curve slopes down? Problem 24RQ: Briefly explain the reason for the near-horizontal shape of the SRAS curve on its far left. Problem 25RQ: Briefly explain the reason for the near-vertical shape of the SRAS curve on its far right. Problem 26RQ: What is potential GDP? Problem 27RQ: Name some factors that could cause the SRAS curve to shift, and say whether they would shift SRAS to... Problem 28RQ: Will the shift of SRAS to the right tend to make the equilibrium quantity and price level higher or... Problem 29RQ: What is stagflation? Problem 30RQ: Name some factors that could cause AD to shift, and say whether they would shift AD to the tight or... Problem 31RQ: Would a shift of AD to the right tend to make the equilibrium quantity and price level higher or... Problem 32RQ: How is long-term growth illustrated in an AD/AS model? Problem 33RQ: How is recession illustrated in an AD/AS model? Problem 34RQ: How is cyclical unemployment illustrated in an AD/AS model? Problem 35RQ: How is the natural rate of unemployment Illustrated in an AD/AS model? Problem 36RQ: How is pressure for inflationary price increases shown in an AD/AS model? Problem 37RQ: What are some of the ways in which exports and imports can affect the AD/AS model? Problem 38RQ: What is the Keynesian zone of the SRAS curve? How much is the price level likely to change in the... Problem 39RQ: What is the neoclassical zone of the SRAS curve? How much is the output level likely to change in... Problem 40RQ: What is the intermediate zone of the SRAS curve? Will a rise in output be accompanied by a rise or a... Problem 41CTQ: Why would an economist choose either the neoclassical perspective or the Keynesian perspective, but... Problem 42CTQ: On a microeconomic demand curve, a decrease in price causes an increase in quantity demanded because... Problem 43CTQ: Economists expect that as the labor market continues to tighten going into the latter part of 2015... Problem 44CTQ: If new government regulations require firms to use a cleaner technology that is also less efficient... Problem 45CTQ: During spring 2016 the Midwestern United States, which has a large agricultural base, experiences... Problem 46CTQ: Hydraulic fracturing (tracking) has the potential to significantly increase the amount of natural... Problem 47CTQ: Some politicians have suggested tying the minimum wage to the consumer price index (CPI). Using the... Problem 48CTQ: If households decide to save a larger portion of their income, what effect would this have on the... Problem 49CTQ: If firms become more optimistic about the future of the economy and, at the same time, innovation in... Problem 50CTQ: If Congress cuts taxes at the same time that businesses become more pessimistic about the economy,... Problem 51CTQ: Suppose the level of structural unemployment increases. How would you illustrate the increase in... Problem 52CTQ: If foreign wealth-holders decide that the United States is the safest place to invest their savings,... Problem 53CTQ: The AD/AS model is static. It shows a snapshot of the economy at a given point in time. Both... Problem 54CTQ: Explain why the short-run aggregate supply curve might be fairly flat in the Keynesian zone of the... Problem 55CTQ: Explain why the short-run aggregate supply curve might be vertical in the neoclassical zone of the... Problem 56CTQ: Why might it be important for policymakers to know which in zone of the SRAS curve the economy Is? Problem 57CTQ: In your view, is the economy currently operating in the Keynesian, intermediate or neoclassical... Problem 58CTQ: Are Says law and Keynes law necessarily mutually exclusive? Problem 59CTQ: Review the problem in the Work It Out titled Interpreting the AD/AS Model. Like the information... Problem 60CTQ: The imaginary country of Harris Island has the aggregate supply and aggregate demand curves as Table... Problem 61P: Table 24.4 describes Santhers economy. Plot the AD/AS curves and identify the equilibrium. Would you... Problem 3SCQ: The short run aggregate supply curve was constructed assuming that as the price of outputs...
Consider an economy that is currently experiencing a recessionary output gap . As the economy adjusts back towards full employment, we expect the wage rate to
Question 9Answer
a.
decrease, shifting the aggregate demand curve downward.
b.
decrease, shifting the aggregate supply curve downward.
c.
increase, shifting the aggregate supply curve upward.
d.
increase, shifting the aggregate demand curve upward.
e.
decrease, increasing potential GDP .
Definition Definition Total supply of goods and services in an economy at a certain price level in a specific time period.
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