QUESTION 3Figure 11.2 shows the relationship between the price level and real GDP. Suppose the economy is currently at e'. A leftward shift of theshort-run aggregate supply curve would return the economy to potential output at:Figure 11.2Price levelPotential outputLRASP₁P₂PsP08Q₂Q₁8SRASADAD*AD'RealGDP(trillions ofdollars)a. point e".b. a point higher than e".c. point e.d. a point between e" and e*.e. point e.mit to save and submit. Click Save All Answers to save all answers.Glose Winda

The total supply of goods and services produced in an economy in an aspect time period is called…

UESTION 3 Figure 11.2 shows the relationship between the price level and real GDP. Suppose the economy is currently at e'. A leftward shift of the short-run aggregate supply curve would return the economy to potential output at: Figure 11.2 Price level P₁ Pa P₂ Potential output LRAS 0 a a. point e". b. a point higher than e". c. point e. d. a point between e" and e*. e. point e. f d SRAS AD' AD AD* Real GDP(trillions of dollars)

UESTION 3 Figure 11.2 shows the relationship between the price level and real GDP. Suppose the economy is currently at e'. A leftward shift of the short-run aggregate supply curve would return the economy to potential output at: Figure 11.2 Price level P₁ Pa P₂ Potential output LRAS 0 a a. point e". b. a point higher than e". c. point e. d. a point between e" and e. e. point e. f d SRAS AD' AD AD Real GDP(trillions of dollars)

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 O B Price Level Quantity of Output Quantity of Output Refer to the Figure 14-1. In the short run, what would result from a favourable shift in aggregate supply? O a. It would move the economy from A to B. O b. It would move the economy from B to C. Oc. It would move the economy from C to D. O d. It would move the economy from D to A.
会 M * 00 b. 30 20 PRICE LEVEL A ng.cengage.com Cengage Learning MindTap - Cengage Learning E Assignments CENGAGE MINDTAP Q Sea Aplia Homework: Aggregate Supply and Macroeconomic Equilibrium 0. M. 09 C. 40 2 3 9. REAL GDP (Trillions of dollars) 8 4. 5. 7. Identify which curve on the previous graph corresponds to each description in the following table. If the curve described does not appear on the graph, choose Not Shown. Description Not Shown Long-run aggregate supply (LRAS) Aggregate demand (AD) Short-run aggregate supply (SRAS) when the economy is at long-run equilibrium Short-run aggregate supply (SRAS) when there is an inflationary gap Short-run aggregate supply (SRAS) when there is a recessionary gap MacBook Air esc 08 F1 F2 F3 F4 F5 F8 i 23 2$ 2 3. 9. 4. 7. 8. tab R. A K caps lock H. shift B.
The economy is depicted in the graph to the right. a. Suppose, there are new discoveries of key raw materials. Which of the following best describes the result of this event? O A. The short-run aggregate supply curve shifts out while the long-run aggregate supply curve shifts in. OB. Both the short-run and long-run aggregate supply curves shift outward. OC. The short-run aggregate supply curve shifts inward while the long-run aggregate supply curve shifts outward. OD. Both the short and long-run aggregate supply curves shift inward. b. Complete the diagram. 1.) Using the line drawing tool, draw the new long-run aggregate supply curve representing this shock. Label it as LRAS,. 2.) Using the 3-point curved line drawing tool, draw the new SRAS representing this shock. Label it 'SRAS,'. Carefully follow the instructions above, and only draw the required objects. to search O
6. Why the aggregate supply curve slopes upward in the short run In the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price level in the economy deviates from the expected price level. Several theories explain how this might happen. For example, the sticky-price theory asserts that the output prices of some goods and services adjust slowly to changes in the price level. Suppose firms announce the prices for their products in advance, based on an expected price level of 100 for the coming year. Many of the firms sell their goods through catalogs and face high costs of reprinting if they change prices. The actual price level turns out to be 90. Faced with high menu costs, the firms that rely on catalog sales choose not to adjust their prices. Sales from catalogs will v , and firms that rely on catalogs will respond by v the quantity of output they supply. If enough firms face high costs of adjusting prices, the unexpected…
A(I) and (ii) pls!
3. Most global markets have been reporting severe contractions, which mainly responding to the COVID-19 pandemic. The situation is worsened by the decrease in people’s confidence in the government as policymakers, spreading a wave of pessimism towards the future prospect of the economy. Explain how such wave of pessimism, ceteris paribus, may lead to short-term economic fluctuations, which will eventually work to push the economy back towards its long-run equilibrium. Use relevant diagrams to support your answer.
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ans ences rations If in Year 1 the price level was 100 and real GDP was $20 trillion and in Year 2 the price level was 105 and real GDP was $21 billion, then the predominant change that occured in Year 2 was OA a decrease in aggregate demand. B. an increase (shift to the right) in short-run aggregate supply. OC. a decrease (shift to the left) in short-run aggregate supply OD. an increase in aggregate demand.
170 Price 140 level 120 100 D AD5 AD4 AD 3 AD, AD2 3.0 4.0 5.0 6.0 7.0 8.0 Real GDP In Exhibit 20-8, if aggregate demand shifts from AD₁ to AD3, O a. real GDP will increase from $3.0 to $4.0, and the price level will increase from 100 to 140. Ob. real GDP will increase from $3.0 to $7.0, and the price level will increase from 100 to 120. Oc. real GDP will increase from $3.0 to $7.0, and the price level will increase from 100 to 140. Od. real GDP will increase from $3.0 to $4.0, and the price level does not change.
Price level Figure 10-7 LRAS SRAS₂ SRASO J H SRAS ADO Real GDP Refer to Figure 10-7. Starting from long-run equilibrium at point F, at which of the following points would short-run equilibrium occur following a drought in the Midwestern states? O al O b. F OC.G O d.H
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
Consider an economy with the following aggregate demand (AD) and short-run aggregate supply (SRAS) schedules. Decision-makers have previously made decisions anticipat- ing that the price level during the current period will be p 105° a. Indicate the quantity of GDP that will be produced during the period.