1. Aggregate supply definitionsThe short-run aggregate supply curve shows:O The relationship between the price level and aggregate expenditureO What happens to the level of real GDP suppliers are willing and able to produce in an economy as the overall price level changes, during aperiod in which output prices can change but input prices are fixedO How firms respond to changes in interest ratesO What happens to output in an economy when the government spends more moneyWhich of the following are assumed to remain unchanged along a given short-run aggregate supply curve? Check all that apply.O Real GDPO Input pricesO The position of the aggregate demand curveO The technology available to firmsThe natural rate of unemployment refers to:O The unemployment rate that occurs when an economy's real GDP is equal to its potential outputO The unemployment that arises due to purely seasonal factors, such as unemployed lifeguards in the winterO The unemployment rate that would occur if there were no frictional unemploymentO The minimum possible unemployment rate of an economyComplete the following table by matching each definition to the appropriate economic time frame.DefinitionShort RunLong RunA period of time in which all input prices and wages are renegotiatedA period of time in which some input prices and wages are fixed

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The short-run aggregate supply curve shows: O The relationship between the price level and aggregate expenditure O What happens to the level of real GDP suppliers are willing and able to produce in an economy as the overall price level changes, during a period in which output prices can change but input prices are fixed How firms respond to changes in interest rates O What happens to output in an economy when the government spends more money

The short-run aggregate supply curve shows: O The relationship between the price level and aggregate expenditure O What happens to the level of real GDP suppliers are willing and able to produce in an economy as the overall price level changes, during a period in which output prices can change but input prices are fixed How firms respond to changes in interest rates O What happens to output in an economy when the government spends more money

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Price level (GDP price index, 2012 = 100) Potential Potential GDP, AS, GDP2 AS2 Real GDP (trillions of 2012 dollars)
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Which of the following causes the short-run aggregate supply curve to shift to the right? O A. an increase in the expected price of an important natural resource B. a positive technological change O C. a higher expected future price level O D. a decrease in the capital stock
$ Which of the following would cause the Aggregate Supply curve to move from AS to AS2 in the graph below? fs Price Level 150 140 130 120 110 100 90 80 70 60 % 5 0 16 5 O A general increase in energy and labor cost for businesses. O A federal government increase in spending. t 6 10 15 Real GDP ($ billion) -AS-AD-AS2 2 fa lyi & 7 7 J * 20 8 8 num lk ( 25 (1¹) 9
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Question 41 The following equations describe the economy: C= 150 + 0.9Yd | = 150 G = 250 X 200 IM = 0.06Y T= 0.1Y At the equilibrium level of GDP, net exports are equal to a).-180 O b) - -20 Oc) 200 O d) 20 Next Page Previous Page Question 40 The following equations describe the economy: C = 150 + 0.9Y | = 150 G = 250 X 200 IM = 0.06Y T= 0.1Y In equilibrium GDP is equal to a) 3,000 b) 750 Oc) 3,750 O d) 7,500
Use the following graph to answer the next question. Price Level 0 AS3 AS₁ AS₂ Real Domestic Output, GDP Which of the following factors will shift AS1 to AS2? O An increase in real interest rates O A decrease in business subsidies O An increase in input prices O A decrease in business taxes.
Which of the following would cause the Aggregate Supply curve to move from AS to AS2 in the graph below? A) A general increase in energy and labor cost for businesses. B) A general decrease in labor cost for businesses. C) An increase in productivity. D) A federal government increase in spending.
In order to shift the vertical aggregate supply curve to the left, which of the following would have to occur? O expansion of potential GDP O increase in productivity flexible wage and price adjustments O breakdown of key market institutions
Starting at long run equilibrium, ceteris paribus, an increase in the costs of widely used factors of production would most likely O Increase short run aggregate supply and create an inflationary gap. O Decrease long run aggregate supply and create a recessionary gap. O Decrease short run aggregate supply and create a recessionary gap. O Decrease aggregate demand and create a recessionary gap.