Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question

Transcribed Image Text:Price level
120-
100-
80-
60-
40-
0
LRAS
12
Real GDP ($ trillions)
SRAS
16
20
o

Transcribed Image Text:The graph shows long- and short-run aggregate supply curves, using modern Keynesian analysis.
Suppose that a hurricane temporarily disrupts oil production.
Using the line and/or the 3-point curved line drawing tool, show the effect (if any) on each curve. Properly label your curve(s).
Carefully follow the instructions above, and only draw the required objects.
tuestion 3.8
re to search
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Expert Solution

Step 1
The graph above shows the short run aggregate and long run aggregate supply curve. when hurricane temporarily disrupt the supply chain of oil production, the result will be decrease in supply of oil in the market. This makes the SRAS curve to shift to the left which increases the price level in the market.
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