In the AD-AS model with an upward-sloping AS-curve, a decrease in oil prices will Multiple Choice O O O O increase prices and output in the long run decrease prices and increase output in the short run increase prices and decrease output in the long run decrease prices and output in the short run decrease prices but have no effect on output in the short run

In the AD-AS model with an upward-sloping AS-curve, a decrease in oil prices will Multiple Choice O O O O increase prices and output in the long run decrease prices and increase output in the short run increase prices and decrease output in the long run decrease prices and output in the short run decrease prices but have no effect on output in the short run

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter22: Aggregate Demand And Aggregate Supply

Section: Chapter Questions

Problem 8P

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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
The figure given below represents the equilibrium real GDP and price level in the aggregate demand and aggregate supply model Figure 8.3 U.S. Price Level B O AD, toAD; O AD, to AD₂ O AD₂ to AD₁ O AS, to AS; AS; to AS₂ 100 200 300 400 AS3 AS₁ AD₂ 500 Real GDP (billions of dollars) AD AS₂ AD3 In Figure 8.3, which of the following shifts would result in stagflation (economic stagnation and inflation)?
Suppose that in 2011, the price of cotton, an input good, decreases in Microtania. Show how this event will change equilibrium output and price level by shifting either the SRAS or AD curve, and then answer the questions below. Did equilibrium output increase or decrease?Increase/Decrease Did equilibrium price increase or decrease?Increase/Decrease
1) aggregate demnad and aggregate supply in market a) using an ad-as diagram, explain what happens if personal income taxes increases b) explain what will happen to an ad-as diagram, if there is a decrease in input prices c) explain the changes in wages can affect equilibrium
The graph below presents the Short Run Aggregate Supply Curve and the Aggregate Demand Curve for Sanaton in 2001. Based on this graph, answer the questions: What is equilibrium output (Real GDP)? What is equilibrium price level?
Describe how a decrease in government defense spending causes the AD curve to shift. What is the effect on the price level and output in the short run? In the long run? Please give me correct answer and full explanation otherwise i give multiple downvote Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism. Answer completely and accurate answer. Rest assured, you will receive an upvote if the answer is accurate.
please answer in text form and in proper format answer with must explanation , calculation for each part and steps clearly
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 LRAS1 curve. Be sure to also label both axis 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 #1 above. Then, Label point B on all applicable graphs above (after the increase in AD), at the intersection of the new equilibrium. -is point B a Short run or Long run equilibrium point? -Indicate the new unemployment rate at Point B that makes…
Which of the following would shift the SRAS curve to the right (ignoring any potential effect on LRAS)? O The world price of oil increases rapidly without warning but is not expected to remain at the new high level permanently. However, in the short run, it is more costly for all firms to produce goods and services. The government introduces a set of new regulations that make it more costly for firms to produce and sell goods and services. These regulations are expected to be permanent. O The interest rate decreases, spurring investment spending. There is an increase in government spending. O There is a technological improvement that allows firms to reduce their costs of production permanently. The following graph shows the short-run aggregate supply (SRAS) curve and the long-run aggregate supply (LRAS) curve for an economy. Suppose the world price of oil decreases rapidly without warning but is not expected to remain at the new low level permanently. However, in the short run, it is…
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.
Explain the effect of the following on price and real income based on AD-AS diagram.Draw and explain the diagram for each part (a) Prediction of World War 3 next year (b) Consumer are optimistic of the economy (c) The government has increased sales and service tax (d) The minimum age for working has been reduced
urgent plz dont copy from anywhere Question 3 [Consider how the COVID-19 pandemic has caused major disruption in global supply chain affecting the supply of critical inputs to production. This has negatively affected the supply side of Singaporean economy on a large scale.] (a) [Illustrate the impact of this supply-side disruption on the Singaporean economy using the AD-AS model. Assume that the economy was initially in good shape and operating at its potential represented by Y*. Provide an explanation to explain what is happening in your diagram. (100 words)] (b) [Following this shock to the economy, as described in part (a) of this question, indicate what would be the response of the Central Bank for each of the scenarios below. Highlight any trade-offs that the Central Bank must consider for each of these potential responses (100 words total) Scenario (i) - Assume the Central Bank is most concerned about inflation. Scenario (ii) - Assume the Central Bank is most concerned about…