The following graph shows a decrease in short-run aggregate supply (AS) in a hypothetical economy where the currency is the dollar. Specifically, the short-run aggregate supply curve shifts to the left from AS1 to AS2, causing the quantity of output supplied at a price level of 100 to fall from $200 billion to $150 billion. PRICE LEVEL 200 175 125 8 76 50 E 25 0 D 50 AS AB 100 150 200 250 300 150 400 QUANTITY OF OUTPUT The following table lists several determinants of short-run aggregate supply. Inflation expectations Tax rates Technology Fill in the table by indicating the changes in the determinants necessary to decrease short-run aggregate supply. Change Needed to Decrease AS
The following graph shows a decrease in short-run aggregate supply (AS) in a hypothetical economy where the currency is the dollar. Specifically, the short-run aggregate supply curve shifts to the left from AS1 to AS2, causing the quantity of output supplied at a price level of 100 to fall from $200 billion to $150 billion. PRICE LEVEL 200 175 125 8 76 50 E 25 0 D 50 AS AB 100 150 200 250 300 150 400 QUANTITY OF OUTPUT The following table lists several determinants of short-run aggregate supply. Inflation expectations Tax rates Technology Fill in the table by indicating the changes in the determinants necessary to decrease short-run aggregate supply. Change Needed to Decrease AS
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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The following graph shows a decrease in short-run
AS
1
to
AS
2
, causing the quantity of output supplied at a
$200
billion to
$150
billion. The following table lists several determinants of short-run aggregate supply. Fill in the table by indicating the changes in the determinants necessary to decrease short-run aggregate supply.
Transcribed Image Text:The following graph shows a decrease in short-run aggregate supply (AS) in a hypothetical economy where the currency is the dollar.
Specifically, the short-run aggregate supply curve shifts to the left from AS1 to AS2, causing the quantity of output supplied at a price
level of 100 to fall from $200 billion to $150 billion.
PRICE LEVEL
200
175
125
76
50
25
3
0
D
50
I
I
100 150 200 250
QUANTITY OF OUTPUT
AS
Inflation expectations
Tax rates
Technology
AS
300 350 400
The following table lists several determinants of short-run aggregate supply.
(?)
Fill in the table by indicating the changes in the determinants necessary to decrease short-run aggregate supply.
Change Needed to Decrease AS
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