The COVID-19 restrictions required firms (businesses) to increase spending on cleaning and QR code check-in compliance. Using the Aggregate Demand-Aggregate Supply model, explain the effect on the equilibrium, inflation and output, of these measures. In your answer, carefully explain the short run and the long run effects. With diagrams

The COVID-19 restrictions required firms (businesses) to increase spending on cleaning and QR code check-in compliance. Using the Aggregate Demand-Aggregate Supply model, explain the effect on the equilibrium, inflation and output, of these measures. In your answer, carefully explain the short run and the long run effects. With diagrams

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Aggregate Demand and Aggregate Supply (AD-AS) Model (Chapter 13) 5.1 Why does the short-run aggregate supply curve slope upward? 5.2 Explain why the long-run aggregate supply curve is vertical. Then, explain how each of the following events would affect the long-run aggregate supply curve. A lower price levels b. A decrease in the labor force A decrease in the quantity of capital goods d. Technological change a. с. 5.3. Starting from long-run equilibrium, use the basic aggregate demand and aggregate supply diagram to show what happens in both the long run and the short run when there is a decline in wealth. Explain how the economy moves back to full employment.
Assume that an economy is initially operating at the natural rate of output (full employment output). Use the AD-AS model to illustrate graphically the effects on price and output of a increase in government spending and an increase in the cash rate. Explain your assumptions with respect to the range of aggregate supply of your analysis. With diagrams
Price Level a b c AS AD AD₁ Real GDP Refer to the figure above. If the aggregate supply curve shifted from ASo to AS₁, we could say that: aggregate supply has increased, and the equilibrium price level has risen to Og aggregate supply has decreased, equilibrium real output has increased, and the equilibrium price level has decreased aggregate supply has decreased, equilibrium real output has decreased, and the equilibrium price level has increased aggregate supply has increased, equilibrium real output has decreased, and the equilibrium price level has increased an increase in the amount of real output supplied has occurred
Please let me know if my answer is correct. I am between C and D. If you can please also let me know why the other choices aren't correct
An increase in the "Z" factors willl decrease the equilibrium price level and decrease aggregate output, ceteris paribus. Select one: True False
"The oil price run - up of 2007 - 08 was caused by strong demand confronting stagnating world production. Although the causes were different, the consequences for the economy appear to have been very similar to those observed in earlier episodes, with significant effects om overall consumption spending and purchases of domestic automobiles in particular. The experience of 2007 - 08 should thus be added to this list of recessions to which oil prices appear to have made a material contribution". Oil price shocks have an evident impact on the short run aggregate supply curve. With the help of a graph demonstrate how rising oil prices affect the SRAS and explain what other factors can cause this shift.
Use the AS-AD model to analyze the impact on the U.S. economy as a result of each of the listed events. Mention if AD and/or AS shift and in which direction. Also explain what the country will experience with respect to increase or decrease in short-run equilibrium real GDP and increase or decrease in the equilibrium price level. For each event, assume that the economy is originally in a full- employment equilibrium, mention if in the new equilibrium there is a recessionary gap or an inflationary gap. A) Congress raises income taxes. B) The Federal Reserve decreases the target for the federal funds rate. C) Migration to the US increases the working- age population. DJ Appreciation in the international value of the dollar.
Covid-19 global economic pandemic has negatively affected economies as a whole at the global,national and regional levels. The novel effects of the fluidity of Covid-19 appears to continue to have negative impacts on the macro business model as the global recession seems to be inevitable.You are working as a macroeconomist in economic affairs in your local country, and you are tasked with analyzing the impact of Covid-19 on the economy and you are required to prepare notes on what specific government policies can be implemented as a stimulus package to jump-start the economy savings and investment market. The team meeting will be held in 3 days from the date of the assignment and because of limitation of time the Chief economist has given you the following guidelines: Help me in identifying four (4) key macroeconomic issues from the impact of Covid-19, For each issue identifed above explain in detail what specific government policy/ies would you implement
Explain why the aggregate supply(AS) curve gets steeper as real GDP increases.. . . DO NOT COPY AND PASTE. please be precise to the question and answer in OWN WORDS.
Note: The hand written solution is not allowed.
a) Think about the Model of Aggregate Demand and Aggregate Supply. How can this model beused to make predictions about the economy of Bangladesh?b) Use the sticky wage theory to explain in detail the upward slope of the SRAS supply curve?
Use an aggregate demand and supply graph to predict the effects of COVID-19 pandemic on inflation and output.