• Equilibrium price level, labeled PL1 Equilibrium real output, labeled Y1 • Assume there is an increase in imports to Econland. Using your graph, show the effect of the increase in imports to the short-run equilibrium of Econland. Label the new level of output Y2 and the new price level PL2.

Q: List and describe the factors that determined the aggregate supply curve in the short and long run…

A: The short-run aggregate supply curve is an upward sloping curve which reflects the volume of…

Q: Determinants of aggregate demand The following graph shows a decrease in aggregate demand (AD)…

A: The changes in the determinants that will lead to a fall in aggregate demand are:Consumer…

Q: The following graph shows the aggregate demand curve (ADAD), the short-run aggregate supply curve…

A: Aggregate Supply is the total quantity of all goods and services produced in an economy at all…

Q: In long-run macroeconomic equilibrium, aggregate quantity demanded equals aggregate quantity…

A: Aggregate demand is the sum of consumption, investment, government expenditure and net exports in an…

Q: Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run,…

A:

Q: If the Federal Reserve wants to increase aggregate demand (i.e., spending growth) which variable…

A: Aggregate demand (AD) is the sum total amount of commodities and services demanded in an economy at…

Q: Use the following graph to answer the following questions. Line Y Price level (P) Line Z * B Line X1…

A: The aggregate demand curve shows the quantity of output that households, firms, the government, and…

Q: When does macroeconomic equilibrium occur? Multiple Choice When exports equal imports. When the…

A: When studying economics, macroeconomics deals with broader concepts of economics that provide…

Q: Assume that aggregate demand is unaffected by the oil price drop. After the economy has fully…

A: Here the supply curve is the curve depicting how much production of manufacturing goods is being…

Q: Assume that the United States economy is currently in a recession in a short-run equilibrium. Draw…

A: When the economy is in recession, real GDP is less than potential GDP.

Q: The graph shows a short-run aggregate supply curve. Please move the endpoints to turn the curve into…

A: ANS In the long run (LR) the amount of output (o/p) produced by an economy is at its potential…

Q: Starting from long run equilibrium,  use the basic aggregate demand and aggregate supply diagram to…

A: Aggregate demand shows the total expenditure done in the economy. Aggregate supply curve shows the…

Q: If the aggregate supply curve shifted from AS0 to AS1 and the aggregate demand curve remains at AD0,…

A: Aggregate demand (AD): - It is the total demand of goods and services in an economy at a particular…

Q: The following graph represents the short-run aggregate supply curve (SRAS) based on an expected…

A: Full employment means that unemployment is equivalent to its natural rate. Full employment also…

Q: In the past two decades, the government of Qatar has made significant investments to increase the…

A:

Q: Assume the Federal Reserve triples the growth rate of the quantity of money in circulation. In the…

A: The demand is defined as the desire of an individual to buy a product. The individual must have the…

Q: Draw an ADAS graph at equilibrium. Suppose there is an increase in government spending. Which curve…

A: The following diagram shows the AD-AS graph at equilibrium.

Q: The diagram below shows various points on three aggregate demand (AD) curves Price Level Z AD₁ AD₂…

A: Aggregate demand represent the total demand of goods and services produced in a economy at a given…

Q: If the long run aggregate supply curve shifts, does the short run aggregate supply curve also have…

A: The short run aggregate supply slopes upwards while the long run supply curve is vertical. The long…

Q: Which of the following reasons could explain why the aggregate quantity of output supplied changes?…

A: Investment expenditure, also referred to as gross private domestic investment, encompasses the…

Q: Then the world economy expands and the demand for Canadian-produced goods increases. Draw a curve…

A: Aggregate supply (AS) refers to the total quantity of goods and services that all producers in an…

Q: Draw an ADAS graph at equilibrium. Suppose the stock market crashes. Which curve will shift? Draw…

A: Stock market crashes means sudden decline in stock prices which is a great loss to the existing…

Q: One of your classmates is convinced that the actual amount of output that corresponds to the…

A: The fixed LRAS corresponds to the the natural level of output, which the economy can produce at…

Q: In 1998, the economy of Aptonville had an aggregate demand and aggregate supply according to the…

A: In an economy, the equilibrium level of general price if the one at which aggregate supply equates…

Q: The following graph plots aggregate demand (AD2027AD2027) and aggregate supply (AS) for the…

A: The natural rate of unemployment is the minimum unemployment where the economy stays healthy. The…

Q: Which of the following factors affect the Long-Run Aggregate Supply curve? Choose all that apply.…

A: The link between an economy's overall output and the price level over the long run, assuming all…

Q: Which range of aggregate supply would represent an economy where prices are rising as output…

A: The aggregate supply of a country's economy is its output of goods and services. The four production…

Q: In 2000, the economy of Singsville had an aggregate demand and aggregate supply according to the…

A: Aggregate demand is defined as the total expenditure incurred by all the sectors of the economy to…

Q: In the aggregate demand-supply model, a short-run equilibrium occurs at the combination of output…

A: Aggregate demand is the sum of Consumption, Investment, government spending and net export.  Long…

Q: How did the decline in U.S. home prices in 2006–2008 affect aggregate demand?

A: In year 2006-2008, there a large decline in the U.S. home prices which has a negative impact on the…

Q: Use an AD/AS graph to show the macroeconomy of Chicagoland. Label the graph correctly

A: The equilibrium in the economy is determined by the intersection of the Aggregate Demand and the…

Q: As a result of this change, the unemployment rate Use the sticky-wage theory of aggregate supply to…

A: Aggregate demand refers to the sum of all the demands for the goods and services produced within the…

Q: The computer industry developed a new technology that reduces the number of resources used to build…

A: Aggregate demand: Aggregate demand can be defined as the sum total of all the goods and services…

Q: Suppose there is an international recession hits the US economy, what is the long-run equilibrium…

A: The explanation that at whatever point the economy enters a downturn, its long-run run aggregate…

Q: The following events shift either aggregate demand, aggregate supply, both or neither. Using a…

A: The equilibrium price is set up where the aggregate demand and aggregate supply are equal.