3*Options for a) are: recessionary or inflationary*Options for d) are: deficit or surplus The economy of Morin is shown in the figure below.The Economy of MorinADAS170150-130-110 -90 -70+ (480, 80480480500520540560580600Real GDPa. If potential GDP (LAS) is $580, and the economy is presently in equilibrium, then there is a(n) (Click to select) ♥ gap of $|billion.b. In order to close this gap aggregate demand must increase by $billion.c. If every $1 change in government spending leads to a $4 change in aggregate demand, government spending must increase by $|billion.d. Suppose that initially government had a balanced budget. If government increases its spending as in part (c) and tax revenues are0.25 of real GDP, what will be the government's real budget surplus/deficit at full-employment equilibrium?The government budget would have a (Click to select) v of $billion.Price Level

a. Potential GDP is denoted by the Long-run Average Cost. It is given that potential GDP (Y*) is…

The economy of Morin is shown in the figure below. The Economy of Morin AD AS 170- 150- 130- 110- 90 - 70 460 (480. 80) 500 520 480 540 560 580 600 Real GDP a. If potential GDP (LAS) is $580, and the economy is presently in equilibrium, then there is a(n) [(Click to select) ♥ gap of o. In order to close this gap aggregate demand must increase by $ [ |billion. E. If every $1 change in government spending leads to a $4 change in aggregate demand, government spending must ]billion. d. Suppose that initially government had a balanced budget. If government increases its spending as in part (c) and tax 0.25 of real GDP, what will be the government's real budget surplus/deficit at full-employment equilibrium? The government budget would have a (Click to select) ♥ of $ [ |billion. Price Level

The economy of Morin is shown in the figure below. The Economy of Morin AD AS 170- 150- 130- 110- 90 - 70 460 (480. 80) 500 520 480 540 560 580 600 Real GDP a. If potential GDP (LAS) is $580, and the economy is presently in equilibrium, then there is a(n) [(Click to select) ♥ gap of o. In order to close this gap aggregate demand must increase by $ [ |billion. E. If every $1 change in government spending leads to a $4 change in aggregate demand, government spending must ]billion. d. Suppose that initially government had a balanced budget. If government increases its spending as in part (c) and tax 0.25 of real GDP, what will be the government's real budget surplus/deficit at full-employment equilibrium? The government budget would have a (Click to select) ♥ of $ [ |billion. Price Level

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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