The graph shows a short-run aggregate supply curve. Please move the endpoints to turn the curve into a long-run aggregate supply curve. Real GDP Long-run aggregate supply has this characteristic because the federal government makes up the difference between GDP and potential output. the ability of the economy to produce determines long-run output. This ability is independent of price levels. consumers adjust their decisions based on average price. Average price level

The graph shows a short-run aggregate supply curve. Please move the endpoints to turn the curve into a long-run aggregate supply curve. Real GDP Long-run aggregate supply has this characteristic because the federal government makes up the difference between GDP and potential output. the ability of the economy to produce determines long-run output. This ability is independent of price levels. consumers adjust their decisions based on average price. Average 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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A vertical aggregate supply graph indicates that aggregate demand has no effect on: Group of answer choices Quantity of output Wages Prices Inflation
An increase in the price of an imported resource will cause, Group of answer choices: The aggregate supply curve to remain the same. The Aggregate supply curve to shift to the right The Aggregate supply curve to shift to the left a movement along the Aggregate supply curve The economy to operate in the long-run
In 2004, the economy of Minitown had an aggregate demand and aggregate supply according to the following schedule: PRice level Aggregate Demand Short-run Aggregate supply Long run aggregate supply 100 $1625 $1205 $1370 110 $1550 $1270 $1370 120 $1475 $1335 $1370 130 $1400 $1400 $1370 140 $1325 $1465 $1370 150 $1250 $1530 $1370 160 $1175 $1595 $1370 What was Minitown’s short-run equilibrium output in 2004?
Which combination of factors would most likely increase aggregate demand? Pick your answer from below and explain your answer choice using aggregate demand and aggregate supply. An increase in household indebtedness and a decrease in net exports. An increase in consumer wealth and a decrease in interest rates. An increase in net exports and a decrease in government spending. An increase in business taxes and a decrease in profit expectations.
The following graph represents the short-run aggregate supply curve (SRAS) based on an expected price level of 120. The economy's full- employment output level is $9 trillion. Major unions across the country have recently negotiated three-year wage contracts with employers. The wage contracts are based on an expected price level of 120, but the actual price level turns out to be 160. Show the short-run effect of the unexpectedly high price level by dragging the curve or moving the point to the appropriate position. PRICE LEVEL (CPI) 240 200 160 40 0 0 3 SRAS[120] 6 9 12 REAL GDP (Trillions of dollars) 15 18 SRAS[120] 0 (?) Interpret the change you drew on the previous graph by filling in the blanks in the following paragraph:
Which of the following would increase aggregate demand? A) Increase in taxation. B) Increase in savings. C) Decrease in consumption spending. D) Increase in government spending.
Consider the aggregate demand-aggregate supply diagram below, which represents the macroeconomy. Suppose the market is initially at an equilibrium at point A. What effect will the Fed's actions have on this graph? Price level (GDP deflator. 2009 = 100) P1 LRAS SRASI AD₁ GDP₁ GDP Real GDP (trillions of 2009 dollars)
The graph above refers to a significant increase in individual income taxes, taking them to their highest level in 50 years. Which of the following is likely to result? a) macroeconomic supply will decrease in the short run b) the economy will experience lower economic growth c) inflationary pressures will be mild d) cyclical unemployment will decrease
Suppose firms become very pessimistic about future business conditions and significantly reduce investment spending. Show the short-run effect of this pessimism on the aggregate-demand curve. Price Level LRAS Aggregate Supply * Aggregate Demand Quantity of Output Aggregate Demand Aggregate Supply LRAS
A vertical aggregate supply graph indicates that aggregate demand has no effect on: A) Prices B) Inflation C) Wages D) Quantity of output
A ship gets stuck in the Suez Canal that shuts down shipping lanes. If we start in equilibrium, what happens? Aggregate demand to shift left. Short-run aggregate supply to shift right. Short-run aggregate supply to shift left. Aggregate demand to shift right.
Which of the following would not shift the aggregate demand curve to the left? Group of answer choices An decrease in government spending. An increase in income taxes. A stock market boom. A decrease in the money supply.