Draw an AD/AS model in purely competitive long run initial equilibrium. Label the price level P*=100and YF=10. Label the SRAS1 and the AD1 curve. Label the LRAS1 curve. Be sure to also label bothaxis correctly.]Draw a graph of the "business cycle." Show the long run growth trend line (put a trend percentage the"makes sense") and the cyclical curve around that trend line. Be sure to also label both axis correctly.Label point A on both graphs in #1 and #2 above. Then on graph in #1, indicate the full employment level(i.e., the "usual" unemployment rate in LR initial equilibrium) at point A for YF* (at full potential output)in initial equilibrium.Assume an Increase in AD for any reason (increase in Aggregate Demand) and show it on graph #1above. Then, Label point B on all applicable graphs above (after the increase in AD), at the intersection ofthe new equilibrium.-is point B a Short run or Long run equilibrium point?-Indicate the new unemployment rate at Point B that makes sense at YF2 and P2 (at the new equilibriumat point B) on the graph in #1. Also, use numbers for YF2 and P2 CPI that "make sense" on the graph in#1 above.indicate new numbers for point B that Make sense for the Nominal GDP growth equation (in #4 above)and business cycle (#2 above)write out the equation for GDP for the Expenditure approach that = Output = YF=AD= GDPwrite out the equation for Nominal GDP growth (use numbers that "make sense" for Point A, Point B,Point C like we did in class)-Equation:-Point A:-Point B:-Point C:

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Draw an AD/AS model in purely competitive long run initial equilibrium. Label the price level P*=100 and YF* 10. Label the SRAS1 and the AD1 curve. Label the LRASI curve. Be sure to also label both axis correctly.]

Draw an AD/AS model in purely competitive long run initial equilibrium. Label the price level P=100 and YF 10. Label the SRAS1 and the AD1 curve. Label the LRASI curve. Be sure to also label both axis correctly.]

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The outbreak of COVID-19 adversely attacks most economies. Some economists e/2 argue that the impacts on the macroeconomy mainly come from (i) the reduction in consumption and investment appetite, while others believe that the impacts mainly come from (ii) the immediate destruction of the supply-chain and production. Suppose two quarters since the outbreak of the COVID-19, changes in selected macroeconomic data of Country X can be summarized as below: Last year This year Annualized economic growth rate 4% -6% Unemployment rate 5% 8% Inflation rate 2% 5% Using an AD-AS model, explain whether argument (i) or (ii) above fits better to а. the case of Country X. b. Given your answer in (a), briefly discuss one plausible short-run dilemma facing the central bank of Country X.
Why the AD curve always negative?
Assume that an economy is initially operating at the natural rate of output (full employmentoutput). Use the AD-AS model to illustrate graphically the effects on price and output of areduction in government spending. Explain your assumptions with respect to the range ofaggregate supply of your analysis.
A major demographic change that has been affecting the U.S. is the wave of retirements among aging baby boomers (those born between 1946 and 1964). Combined with the relative decline in the number of young people entering the labor force, the retirement of many boomers will cause the labor force to grow more slowly and age. Use the AD-AS model (along with a labor market graph) to show and explain how this will affect Y, N, W/P, and P over time.
Which of the following is a TRUE statement in the neoclassical model of AD/AS? Because wages are flexible, they are unaffected by high rates of unemployment. The economy cannot sustain production above its potential GDP in the long run. O A surge in aggregate demand ends up as a rise in output, but does not increase price levels. Lower wages will cause an economy-wide increase in the price of a key input.
I'm a newbie so please if you could go step by step. thanks in advance.
Analyse Australia's economy in 2023 using the Mundell Fleming model and derive and draw the aggregate demand curve using the Mundell Fleming model and the aggregate supply curve using the neoclassical model of aggregate supply.
Between 2007 and 2009, the United States experienced a severe financial crisis and economic downturn commonly known as the Great Recession. Starting in 2006, housing values fell 30%, causing losses in mortgage-backed securities for families and financial institutions. The recession was marked by a drop in aggregate demand that caused a decline in GDP and an increase in unemployment. Attached is an example of an aggregate demand and aggregate supply (AD/AS) model that illustrates the general trends of the U.S. economy during the Great Recession. How did the AD/AS equilibrium change over time? Support your claims by referring to your AD/AS model. Select an economic factor (GDP, unemployment, price level) and explain what impact any shifts in AD or AS (or both) had on your chosen factor. Please tailor the answer according the AD/AS model in layman's terms
On the graph, label your starting AD line as AD 2019. Draw a new AD line showing the change to AD due to the pandemic. Label your starting SRAS line as SRAS 2019. Draw a new SRAS line showing the change to supply due to the pandemic.Label the new short-run equilibrium RGDP and Price Level. Does output (i.e. RGDP) increase or decrease in your model? Does the price level increase or decrease in your model? According to the AD-AS model when RGDP falls the unemployment rises and vice versa. Does your graph indicate an increase or decrease in the unemployment rate
Hayek says that markers will heal themselves and that government should not intervene. How does the AD-AS model reflect Hayek's idea that governments cannot increase real GDP beyond the level that the free market economy is able to produce
Show and explain graphically the AD/AS model in neoclassical economic and macroeconomic.
Hayek says that markets will heal themselves and that government should not intervene. How does the AD-AS model reflect Hayeks idea that governments cannot increase real GDP beyond the level that the free market economy is able to produce?