v the AD, SAS, and LAS curves, show the equilibrium level of real GDP and price level. is the value of Potential GDP? t is the value of short run macroeconomics equilibrium GDP ? is the value of short run macroeconomics equilibrium price level? e country producing above, below or at full employment? t is the name of the gap if any? - is the size of the gap? ere positive or negative cyclical unemployment ? ou have to Increase or decrease GDP?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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Please solve parts G,H,I

The table below shows the initial aggregate demand, short-run, and long-run aggregate supply schedules -
Aggregate demand
(billion $)
Aggregate Supply (billion Long run Aggregate supply
Price level
$)
(billion $)
80
1600
400
800
90
1400
600
800
100
1200
800
800
110
1000
1000
800
120
800
1200
800
130
600
1400
800
140
400
1600
800
a.
Draw the AD, SAS, and LAS curves, show the equilibrium level of real GDP and price level.
b.
What is the value of Potential GDP?
C.
What is the value of short run macroeconomics equilibrium GDP ?
d.
What is the value of short run macroeconomics equilibrium price level?
Is the country producing above, below or at full employment?
е.
f.
What is the name of the gap if any?
g.
What is the size of the gap?
h.
Is there positive or negative cyclical unemployment ?
i.
Do you have to Increase or decrease GDP?
j.
Should the country implement expansionary or contractionary policy?
Transcribed Image Text:The table below shows the initial aggregate demand, short-run, and long-run aggregate supply schedules - Aggregate demand (billion $) Aggregate Supply (billion Long run Aggregate supply Price level $) (billion $) 80 1600 400 800 90 1400 600 800 100 1200 800 800 110 1000 1000 800 120 800 1200 800 130 600 1400 800 140 400 1600 800 a. Draw the AD, SAS, and LAS curves, show the equilibrium level of real GDP and price level. b. What is the value of Potential GDP? C. What is the value of short run macroeconomics equilibrium GDP ? d. What is the value of short run macroeconomics equilibrium price level? Is the country producing above, below or at full employment? е. f. What is the name of the gap if any? g. What is the size of the gap? h. Is there positive or negative cyclical unemployment ? i. Do you have to Increase or decrease GDP? j. Should the country implement expansionary or contractionary policy?
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