0110COxp381In the figure, the economy is at an equilibrium with real GDP of $20 trillion and aprice level of 110. As the economy moves toward its ultimate equilibrium, thecurve shifts,because0 0 0 0 0A. aggregate demand; leftward; the money wage rate risesB. aggregate supply: rightward; the money wage rate fallsOC. potential GDP; leftward; the money wage rate fallsD. aggregate demand; rightward; the money wage rate fallsOE. aggregate supply; leftward; the money wage rate rises130-120-110-100-Price level (GDP price Index, 2012 = 100)Potential GDP90-ASAD19.019.520.0 20.5 21.0 21.5 22.0Real GDP (trillions of 2012 dollars)✓ ✓5

At present, the economy is in equilibrium where the price level is $110 and the real GDP is 20.The…

In the figure, the economy is at an equilibrium with real GDP of $20 trillion and a price level of 110. As the economy moves toward its ultimate equilibrium, the curve shifts because A. aggregate demand; leftward; the money wage rate rises B. aggregate supply: rightward; the money wage rate falls C. potential GDP; leftward; the money wage rate falls OD. aggregate demand; rightward; the money wage rate falls E. aggregate supply; leftward; the money wage rate rises 130- 120- 110 100- 90- Price level (GDP price index, 2012 = 100) Potential GDP AS AD 19.0 19.5 20.0 20.5 21.0 21.5 22.0 Real GDP (trillions of 2012 dollars)

In the figure, the economy is at an equilibrium with real GDP of $20 trillion and a price level of 110. As the economy moves toward its ultimate equilibrium, the curve shifts because A. aggregate demand; leftward; the money wage rate rises B. aggregate supply: rightward; the money wage rate falls C. potential GDP; leftward; the money wage rate falls OD. aggregate demand; rightward; the money wage rate falls E. aggregate supply; leftward; the money wage rate rises 130- 120- 110 100- 90- Price level (GDP price index, 2012 = 100) Potential GDP AS AD 19.0 19.5 20.0 20.5 21.0 21.5 22.0 Real GDP (trillions of 2012 dollars)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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