Question 7The diagram below shows the aggregate demand and short-run aggregatesupply curves for an economy, where X is the initial equilibrium.PriceLevelABCDABCDC CAD DXDSRAS3OSRAS1SRAS2AD3Real National OutputWhere will be the new equilibrium position (A, B, C or D) following asignificant increase in productivity and reduction in imports?AD1AD2

AD shows negative relationship between the price level and real output on the other AS shows…

Question 7 The diagram below shows the aggregate demand and short-run aggregate supply curves for an economy, where X is the initial equilibrium. Price Level A ABCD ABCD B D SRAS3 SRAS1 SRAS2 AD3 AD1 AD2 Real National Output Where will be the new equilibrium position (A, B, C or D) following a increase in productivity and reduction in imports? significant

Question 7 The diagram below shows the aggregate demand and short-run aggregate supply curves for an economy, where X is the initial equilibrium. Price Level A ABCD ABCD B D SRAS3 SRAS1 SRAS2 AD3 AD1 AD2 Real National Output Where will be the new equilibrium position (A, B, C or D) following a increase in productivity and reduction in imports? significant

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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3. Determinants of aggregate demand The following graph shows an increase in aggregate demand (AD) in a hypothetical country. Specifically, aggregate demand shifts to the right from AD₁ to AD2, causing the quantity of output demanded to rise at all price levels. For example, at a price level of 140, output is now $400 billion, where previously it was $300 billion. 170 PRICE LEVEL 160 150 140 120 110 100 90 0 +--+ AD2 AD1 600 100 200 300 400 500 OUTPUT (Billions of dollars) 700 800
10-8. Assume that the position of a nation's aggregate demand curve has not changed, but the long-run equilibrium price level has declined. Other things being equal, which of the following factors might account for this event? a. An increase in labor productivity b. A decrease in the capital stock c. A decrease in the quantity of money in circulation d. The discovery of new mineral resources used to produce various goods e. A technological improvement
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Demand Equation: QX = 30 - 2.PXInverse Supply Equation: In an economy with PX = (QX / 2) - 5, answer the following questions by calculating the price and quantity generated in equilibrium. i) What is the Equilibrium Price level? ii) What is the Balance Quantity level?
An increase in the price level causes the aggregate supply curve to shift to another supply schedule. True or False
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QUESTION 17 Suppose the aggregate demand and short-run aggregate supply schedules for an economy whose potential output equals $2,700 are given by the table: Aggregate Quantity of Goods and Services Price Level Demanded Supplied 0.50 $3,500 $1,000 0.75 3,000 2,000 1.00 2,500 2,500 1.25 2,000 2,700 1.50 1,500 2,800 What is the size of the recessionary gap?
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Which of the following will increase the Aggregate Demand curve or shift it to the right? The government passes a big infrastructure improvement spending bill O Interest rates rise The raises personal income taxes The U.S. population experiences a significant contraction in population, decreasing the number of people working and consuming. Question 2 Which of the following will decrease the aggregate supply curve or shift it to the left? New international sanctions on Iranian oil raise the price of oil globally and oil is an input in production of many goods and services A 10 percent across the board reduction in personal income tax rates Business taxes fall A new networking technology increases productivity all over the economy
Price Level 0 Q₁ AS AD2 AD₁ Q2 Q3 Real Domestic Output Refer to the above graph. If Preferred Aggregate Equilibrium is achieved at Q2, then aggregate demand is AD1. the equilibrium price and quantity is P1Q3 producers will supply output level Q3. the equilibrium price level is P2.
# I am guessing, the price of imports will decrease is wrong.
Suppose our economy is in macroeconomic equilibrium (also called "general equilibrium") with an upward-sloping aggregate supply curve and a downward-sloping aggregate demand curve. An increase in aggregate demand will: Question 5 options: a) Increase aggregate supply. b) Decrease the price level. c) Causes the aggregate supply to shift to the right. d) Increase real GDP. e) Reduce the number of discouraged workers in the unemployment rate.