The given table shows hypothetical data for five economies. Real GDP is measured in millions of dollars. Complete parts (a) through (e). a. Fill in the missing data in the table. Which economies have an inflationary gap? (Select all that apply.) A. Economy 5 B. Economy 1 C. Economy 2 D. Economy 3 E. Economy 4 Which economies have a recessionary gap? (Select all that apply.) A. Economy 4 B. Economy 5 C. Economy 3 D. Economy 2 E. Economy 1 b. Which economies likely have the most unused capacity? Explain. likely have the most unused capacity, because in these economies c. In which economies are labour and other factors of production in excess demand? (Select all that apply.) A. Economy 5 B. Economy 1 C. Economy 2 D. Economy 3 E. Economy 4 Potential GDP (Y") 74,000 140,000 50,000 4,400 Economy 4 Economy 5 8,400 (Round your responses to one decimal place.) 9,200 Real GDP Economy 1 79,000 Economy 2 157,000 Economy 3 44,000 4,400 Output Gap (% of Y") 6.8% 12.1% -12% 0% -8.7% Rate of Wage Change +0.9% +1.9% -0.5% 0.0% -0.2%

The given table shows hypothetical data for five economies. Real GDP is measured in millions of dollars. Complete parts (a) through (e). a. Fill in the missing data in the table. Which economies have an inflationary gap? (Select all that apply.) A. Economy 5 B. Economy 1 C. Economy 2 D. Economy 3 E. Economy 4 Which economies have a recessionary gap? (Select all that apply.) A. Economy 4 B. Economy 5 C. Economy 3 D. Economy 2 E. Economy 1 b. Which economies likely have the most unused capacity? Explain. likely have the most unused capacity, because in these economies c. In which economies are labour and other factors of production in excess demand? (Select all that apply.) A. Economy 5 B. Economy 1 C. Economy 2 D. Economy 3 E. Economy 4 Potential GDP (Y") 74,000 140,000 50,000 4,400 Economy 4 Economy 5 8,400 (Round your responses to one decimal place.) 9,200 Real GDP Economy 1 79,000 Economy 2 157,000 Economy 3 44,000 4,400 Output Gap (% of Y") 6.8% 12.1% -12% 0% -8.7% Rate of Wage Change +0.9% +1.9% -0.5% 0.0% -0.2%

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Use the diagram below to answer the questions that follow. Suppose that this represents the current state of the economy. Be sure to explain what happens to various economic variables in your answer. Price Level AS AD GDP Potential GDP Actual GDP 1. 2. 3. variables that are affected.
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Read the news clip, then answer the following question. The statement that total sales by businesses were up 0.3 percent means that GDP because OA. Increased by 0.3 percent; GDP is a record of the value of all production B. decreased by 0.3 percent; "total sales by businesses are sales of intermediate goods and services OC. did not change by 0.3 percent, GDP measures production of all final goods and services and "total sales by businesses includes final and intermediate goods and services OD. increased by less than 0.3 percent; we need to subtract retail sales of 1.3 percent from the total sales by businesses to eliminate double counting OE. increased by more than 0.3 percent; "total sales by businesses includes only sales of intermediate goods and services Expansion remains slow The Commerce Department reported that retail sales increased 1.3 percent in Net exports were up 0.8 percent in the first quarter and inventories held by businesses rose by 0.3 percent in June. Total sales by…
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