Suppose that the table presented below shows an economy's relationship between real output and the inputs needed to produce that output: Input Quantity Real GDP 150.0 $400 112.5 300 75.0 200 Instructions: Enter your responses answers rounded to 2 decimal places. a. What is the level of productivity in this economy? b. What is the per-unit cost of production if the price of each input unit is $2? 2$ c. Assume that the input price increases from $2 to $3 with no accompanying change in productivity. What is the new per-unit cost of production? In what direction would the $1 increase in input price push the economy's aggregate supply curve? (Click to select) ♥ What effect would this shift of aggregate supply have on the price level and the level of real output? O The price level would decrease and real output would remain the same. O The price level would increase and real output would decrease. O Both the price level and real output would remain the same. O The price level would decrease and real output would increase. d. Suppose that the increase in input price does not occur but, instead, that productivity increases by 100 percent. What would be the new per-unit cost of production? What effect would this change in per-unit production cost have on the economy's aggregate supply curve? O It would cause the aggregate supply curve to shift right. O No effect. O It would cause the aggregate supply curve to shift left. What effect would this shift of aggregate supply have on the price level and the level of real output? O The price level would decrease and real output would remain the same. O The price level would increase and real output would decrease. O The price level would decrease and real output would increase. O Both the price level and real output would remain the same.
Suppose that the table presented below shows an economy's relationship between real output and the inputs needed to produce that output: Input Quantity Real GDP 150.0 $400 112.5 300 75.0 200 Instructions: Enter your responses answers rounded to 2 decimal places. a. What is the level of productivity in this economy? b. What is the per-unit cost of production if the price of each input unit is $2? 2$ c. Assume that the input price increases from $2 to $3 with no accompanying change in productivity. What is the new per-unit cost of production? In what direction would the $1 increase in input price push the economy's aggregate supply curve? (Click to select) ♥ What effect would this shift of aggregate supply have on the price level and the level of real output? O The price level would decrease and real output would remain the same. O The price level would increase and real output would decrease. O Both the price level and real output would remain the same. O The price level would decrease and real output would increase. d. Suppose that the increase in input price does not occur but, instead, that productivity increases by 100 percent. What would be the new per-unit cost of production? What effect would this change in per-unit production cost have on the economy's aggregate supply curve? O It would cause the aggregate supply curve to shift right. O No effect. O It would cause the aggregate supply curve to shift left. What effect would this shift of aggregate supply have on the price level and the level of real output? O The price level would decrease and real output would remain the same. O The price level would increase and real output would decrease. O The price level would decrease and real output would increase. O Both the price level and real output would remain the same.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Transcribed Image Text:Suppose that the table presented below shows an economy's relationship between real output and the inputs needed to produce that
output:
Input Quantity
Real GDP
150.0
$400
112.5
300
75.0
200
Instructions: Enter your responses answers rounded to 2 decimal places.
a. What is the level of productivity in this economy?
b. What is the per-unit cost of production if the price of each input unit is $2?
2$
C. Assume that the input price increases
production?
$2 to $3 wit
no accompanying change in productivity. What
the new per-unit cost of
2$
In what direction would the $1 increase in input price push the economy's aggregate supply curve?
(Click to select) V
What effect would this shift of aggregate supply have on the price level and the level of real output?
O The price level would decrease and real output would remain the same.
O The price level would increase and real output would decrease.
O Both the price level and real output would remain the same.
O The price level would decrease and real output would increase.
d. Suppose that the increase in input price does not occur but, instead, that productivity increases by 100 percent. What would be the
new per-unit cost of production?
2$
What effect would this change in per-unit production cost have on the economy's aggregate supply curve?
O It would cause the aggregate supply curve to shift right.
O No effect.
O It would cause the aggregate supply curve to shift left.
What effect would this shift of aggregate supply have on the price level and the level of real output?
O The price level would decrease and real output would remain the same.
O The price level would increase and real output would decrease.
O The price level would decrease and real output would increase.
O Both the price level and real output would remain the same.
Expert Solution
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 4 steps with 4 images
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
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
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)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
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-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education