Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
how should I make the curve and the fill in blank
![The graphs illustrate an initial equilibrium for the economy. Suppose that oil prices temporarily decrease.
Use the graphs to show the new positions of aggregate demand (AD), short-run aggregate supply (SRAS), and long-run
aggregate supply (LRAS) in both the short run and the long run, as well as the short-run and long-run equilibriums
resulting from this change. Then, indicate what happens to the price level and GDP in the short run and in the long run.
Short-run graph
Long-run graph
LRAS
LRAS
SRAS
SRAS
Short-ryn equilibrium
Long-run equilibrium
AD
AD
Real GDP
Real GDP
Aggregate price level
Aggregate price level](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F190c60f0-7f74-4be2-8691-1a435c5578f4%2F877b7564-242e-4709-9742-27e1d8457801%2Fd0pnj5_processed.png&w=3840&q=75)
Transcribed Image Text:The graphs illustrate an initial equilibrium for the economy. Suppose that oil prices temporarily decrease.
Use the graphs to show the new positions of aggregate demand (AD), short-run aggregate supply (SRAS), and long-run
aggregate supply (LRAS) in both the short run and the long run, as well as the short-run and long-run equilibriums
resulting from this change. Then, indicate what happens to the price level and GDP in the short run and in the long run.
Short-run graph
Long-run graph
LRAS
LRAS
SRAS
SRAS
Short-ryn equilibrium
Long-run equilibrium
AD
AD
Real GDP
Real GDP
Aggregate price level
Aggregate price level
![Short-run graph
Long-run graph
LRAS
LRAS
SRAS
SRAS
Short-ryn equilibrium
Long-run equilibrium
AD
AD
Real GDP
Real GDP
In the short-run, the price level
and
In the long-run, the price level
and
GDP
GDP
Aggregate price level
Aggregate price level](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F190c60f0-7f74-4be2-8691-1a435c5578f4%2F877b7564-242e-4709-9742-27e1d8457801%2Fx0sty2_processed.png&w=3840&q=75)
Transcribed Image Text:Short-run graph
Long-run graph
LRAS
LRAS
SRAS
SRAS
Short-ryn equilibrium
Long-run equilibrium
AD
AD
Real GDP
Real GDP
In the short-run, the price level
and
In the long-run, the price level
and
GDP
GDP
Aggregate price level
Aggregate price level
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![Principles of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781305585126/9781305585126_smallCoverImage.gif)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Managerial Economics: A Problem Solving Approach](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
![Managerial Economics & Business Strategy (Mcgraw-…](https://www.bartleby.com/isbn_cover_images/9781259290619/9781259290619_smallCoverImage.gif)
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education