Price Level Prices for plastic, a key input in many industries, have decreased due to new technology minimia necessary for manufacturing plastic. Illustrate this effect by shifting the aggregate supply curve in Provide your answer below Aggregate Supply Aggregate Demand Real GDP
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- 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)?Which of the following is not a reason for the downward slope of the aggregate demand curve? As the price level decreases, the quantity demanded of real GDP increases. O As the price level decreases, American products are more attractive than imports, so their aggregate quantity increases. O As the price level decreases, the purchasing power of dollar decreases, so aggregate demand increases. O As the price level decreases, interest rates decrease, so consumption increases.Create a graph for an aggregate demand curve. Use the variable ‘Price Level’ for the vertical axis and ‘Real GDP’ for the horizontal axis. In your answer, explain why there is an inverse relationship between the price level and real GDP. Use your graph to illustrate your explanations. Also, discuss determinants of Aggregate Demandor factors that shift Aggregate Demand curve.
- For a given aggregate supply curve, if the aggregate price level in an economy rises, O real GDP increases aggregate supply increases aggregate demand increasesThe following are aggregate demand and supply schedules for a hypothetical economy. All figures are in $ billions. Aggregate Quantity Demanded Price Index Aggregate Quantity Supplied 2360 2400 2480 2600 2760 3000 3260 3600 3500 3400 3300 3200 3100 3000 2900 2800 120 130 140 150 160 170 180 190 Note: Potential GDP is 3,000. Refer to the information above to answer this question. Assume that technological change increases aggregate supply by 340. What would be the result? An inflationary gap of 340. A recessionary gap of 240. A new full-employment level of Real GDP of 3,340 with no change in prices. A new equilibrium of Real GDP of some indeterminate level depending on how much prices fell. A new full employment level of Real GDP of 3,340 and lower prices.Explain the three reasons the aggregate-demand curve slopes downward. Give an example of an event that would shift the aggregate-demand curve . In which direction would this event shift the curve?
- 160 150 140 130 120 110 100 PRICE LEVEL Aggregate Demand 0 100 200 300 400 500 000 700 800 REAL GDP (Billions of dollars) Which of the following are reasons the aggregate demand curve is downward sloping? Chelk all that apply. A higher price level decreases consumption through the substitution effect. A lower price level makes domestically produced goods less expensive than foreign goods. A higher price level decreases the real value of consumers' assets. As the aggregate price level rises, the cost of borrowing money will This phenomenon is known as the 8 90 Aggregate Demandi 80 causing the quantity of output demanded to: effect.Which of the following would be one of the factors that shift the aggregate demand curve? A change in: Domestic resource availability O Prices of imported resources O Property values O ProductivityCreate a graph for an aggregate demand curve. Use the variable ‘Price Level’ for the vertical axis and ‘Real GDP’ for the horizontal axis. Then explain why there is an inverse relationship between the price level and real GDP. Use your graph to illustrate your explanations. Also, discuss determinants of Aggregate Demand or factors that shift Aggregate Demand curve.
- In 2013, Prussia's aggregate demand curve was determined by the equation M + 1-4% A change in aggregate demand means that in 2014, Prussia's aggregate demand curve was determined by the equation Using this information, draw Prussia's old and new dynamic aggregate demand curves on the graph Which of the factors could have resulted in the change irn aggregate demand seen between 2013 and 2014? 13 AD 2013 an improvement in technology O an increase in imports O higher consumer confidence O a decrease in oil prices 12 AD 2014 10 8 5 4 3 2 4 -3 2 1 0 1 2 3 4 5 6 78 9 10 Real GDP growth rateExplain the influence of the following events on the quantity of real GDP supplied and aggregate supply in India. When fuel prices rise When the price level in India increases A. short-run aggregate supply decreases; the quantity of real GDP supplied increases O B. long-run aggregate supply decreases; short-run aggregate supply increases OC. long-run aggregate supply increases; the quantity of real GDP supplied increases OD. short-run aggregate supply increases; the quantity of real GDP supplied decreases The graph gives the long-run aggregate supply curve and the short-run aggregate supply curve for India. Suppose Canadian firms move their call handling, IT, and data functions to India. The full-employment price level does not change. If long-run aggregate supply changes, draw the new long-run aggregate supply curve and label it. If short-run aggregate supply changes, draw the new short-run aggregate supply curve and label it. Draw a point at the full-employment price level at…Q.No.5. How the aggregate demand and changes in aggregate demand curves can be drawn graphically. Also illustrate the reasons of:A downward slope of aggregate demand curveB changes in aggregate demand