Suppose that the economy of Witland in the figure below is at full-employment equilibrium and the present nominal wage rate is $23 per hour. Round your answers to two decimal places. Price Level 130 120- 110- 100- 90 200 The economy of Witland 4000 200 400 1600 Real GDP reset 1800 2000 2200 2400 AS AD LAS AD2 AS2 a. The real wage rate (in base year prices) is $ b. Suppose that aggregate demand increases by $400. Draw the new AD curve in the graph above. Plot only the endpoints of the curve. c. At the new equilibrium real GDP level, the value of the real wage rate will be $ d. As a result of the change in prices in b), suppose that nominal wage increases, causing aggregate supply to change by $400. Draw the new AS curve in the graph above. Plot only the endpoints of the curve. e. At the new equilibrium, the new real wage rate will be $ f. At the new equilibrium in e), the value of the nominal wage rate will be $

Suppose that the economy of Witland in the figure below is at full-employment equilibrium and the present nominal wage rate is $23 per hour. Round your answers to two decimal places. Price Level 130 120- 110- 100- 90 200 The economy of Witland 4000 200 400 1600 Real GDP reset 1800 2000 2200 2400 AS AD LAS AD2 AS2 a. The real wage rate (in base year prices) is $ b. Suppose that aggregate demand increases by $400. Draw the new AD curve in the graph above. Plot only the endpoints of the curve. c. At the new equilibrium real GDP level, the value of the real wage rate will be $ d. As a result of the change in prices in b), suppose that nominal wage increases, causing aggregate supply to change by $400. Draw the new AS curve in the graph above. Plot only the endpoints of the curve. e. At the new equilibrium, the new real wage rate will be $ f. At the new equilibrium in e), the value of the nominal wage rate will be $

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Respond to the question with a concise and accurate answer, along with a clear explanation and step-by-step solution, or risk receiving a downvote.

Suppose that the economy of Witland in the figure below is at full-employment equilibrium and the present nominal wage rate is $23
per hour. Round your answers to two decimal places.
Price Level
130-
120-
110-
100-
90
The economy of Witland
1000
200
4400
Real GDP
reset
600
1800
2000
2200
2400
AS
AD
LAS
AD2
AS2
a. The real wage rate (in base year prices) is $
b. Suppose that aggregate demand increases by $400. Draw the new AD curve in the graph above. Plot only the endpoints of the
curve.
c. At the new equilibrium real GDP level, the value of the real wage rate will be $
d. As a result of the change in prices in b), suppose that nominal wage increases, causing aggregate supply to change by $400. Draw
the new AS curve in the graph above. Plot only the endpoints of the curve.
e. At the new equilibrium, the new real wage rate will be $
f. At the new equilibrium in e), the value of the nominal wage rate will be $

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