Topic 3.6- Changes in the AD-AS Model in the Short Run Price Level PL₁ PL₂ PL, PL, LRAS SRAS AD Y, GDPR Use the graph to the right to answer the following questions (assume that each event takes places independently) 1. What is the short-run equilibrium price level and output? 2. Identify the short-run equilibrium price level and output if consumption increased? 3. Identify the short-run equilibrium price level and output after a negative supply shock? 4. What happens to output and unemployment if investment falls? 5. Use the graph to explain the difference between demand-pull and costs-push inflation.
Topic 3.6- Changes in the AD-AS Model in the Short Run Price Level PL₁ PL₂ PL, PL, LRAS SRAS AD Y, GDPR Use the graph to the right to answer the following questions (assume that each event takes places independently) 1. What is the short-run equilibrium price level and output? 2. Identify the short-run equilibrium price level and output if consumption increased? 3. Identify the short-run equilibrium price level and output after a negative supply shock? 4. What happens to output and unemployment if investment falls? 5. Use the graph to explain the difference between demand-pull and costs-push inflation.
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter9: An Introduction To Basic Macroeconomic Markets
Section: Chapter Questions
Problem 1CQ
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Questions 4 & 5
![Topic 3.6- Changes in the AD-AS Model in the Short Run
Price
Level
PL₁
PL₂
PL,
PL
LRAS
SRAS
AD
Y, GDP,
Use the graph to the right to answer the following questions
(assume that each event takes places independently)
1. What is the short-run equilibrium price level and output?
2. Identify the short-run equilibrium price level and output if
consumption increased?
3. Identify the short-run equilibrium price level and output
after a negative supply shock?
4. What happens to output and unemployment if investment falls?
5. Use the graph to explain the difference between
demand-pull and costs-push inflation.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F19314214-c28e-49aa-8f18-1254c2fd581b%2F6c369dd8-1c75-44eb-87c2-086a4bd8cf1a%2Fu38bbne_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Topic 3.6- Changes in the AD-AS Model in the Short Run
Price
Level
PL₁
PL₂
PL,
PL
LRAS
SRAS
AD
Y, GDP,
Use the graph to the right to answer the following questions
(assume that each event takes places independently)
1. What is the short-run equilibrium price level and output?
2. Identify the short-run equilibrium price level and output if
consumption increased?
3. Identify the short-run equilibrium price level and output
after a negative supply shock?
4. What happens to output and unemployment if investment falls?
5. Use the graph to explain the difference between
demand-pull and costs-push inflation.
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