Which of the following is true regarding the aggregate demand-aggregatesupply model given the following scenario: The value of a dollar hasdecreased.Select 2 correct answer(s)The unemployment rate would be greater than the natural rate ofunemployment rate.The output would exceed output at full-employment.It would be more expensive to obtain USD in comparison to foreigncurrency.Aggregate demand would increase.

1. Aggregate demand would increase: In the aggregate demand-aggregate supply (AD-AS) model,…

Answered: Which of the following is true…

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter5: Introduction To Macroeconomics

Section: Chapter Questions

Problem 3.4P

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The imaginary country of Harris Island has the aggregate supply and aggregate demand curves as shown in Table below. Price Level 100 120 140 160 180 AD 700 600 500 400 300 AS 200 325 500 570 620 a. Plot the AD/AS diagram with the axes labeled. Identify the equilibrium. b. Imagine that consumers begin to lose confidence about the state of the economy, and so AD becomes lower by 275 at every price level. Identify the new aggregate equilibrium. c. How will the shift in AD affect the original output, price level, and employment?
A decrease in the price level: a b с Price Level (P) d P2 P₁ a bg Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. Q₁ Q₂ AD AD* Real GDP (Q) is illustrated by a movement along the AD curve from point a to b, and leads to an increase in aggregate demand. is illustrated by a movement along the AD curve from point a to b, and leads to an increase in the quantity demanded of real GDP. results in a shift of the AD curve to the right, such as going from point b on AD to point g on AD*. results in a shift of the AD curve to the left, such as going from point f on AD* to point a on AD.
The model of aggregate demand/aggregate supply... A) Identifies the potential GDP and price level as well as the gap between the price level and the inflation B) Identifies the equilibrium GDP and price level as well as the gap between the equilibrium GDP and the potential GDP C) CIdentifies the equilibrium quantity and price for consumer goods D) Identifies the equilibrium GDP the economy will reach in the long run
None
Aggregate demand is more likely to than aggregate supplyl in the short run a- bigger leakages b-national income c-domestic investment d- shift substantually
Please Use the Aggregate supply and Aggregate Demand Model below to answer the questions that follow. Examine the influence of government expenditure on investment in a nation. Use Jot Inc. Ltd a multinational construction company in which you are the Chief Exec of the firm that that is highly diversified and recieves funds to construct highways and other government funded projects. Also, explain the factors that cause the Aggregate Demand curve to be downward sloping left to right. Thanks
Review the problem shown in the Work It Out titled "Interpreting the AD/AS Model." Like the information provided in that feature, Table 24.2 shows information on aggregate supply, aggregate demand, and the price level for the imaginary country of Xurbia. Price Level AD AS 110 700 600 120 690 640 130 680 680 140 670 720 150 660 740 160 650 760 170 640 770 Table24.2 Price Level: AD/AS Plot the AD/AS diagram from the data shown. Identify the equilibrium. Imagine that, as a result of a government tax cut, aggregate demand becomes higher by 50 at every price level. Identify the new equilibrium. How will the new equilibrium alter output? How will it alter the price level? What do you think will happen to employment?
Suppose you are Herb Stein, Chair of Economic Advisors to President Ford. OPEC has just quadrupled the price of oil. The entire economy uses oil in manufacturing (exaggeration, but not a big one), consequently the costs reflected by the AS curve dramatically increase. Using the AD/AS model, what happens to output and prices? Same role, a recession with inflation now exists(stagflation), both are serious, 10% u/e, 14% inflation. You are thinking of proposing a solution to the recession, the negative GDP gap is $300 billion, the MPC is .75. Businesses won't increase Investment because of fear of losses You remember from your econ 101 class, that there is a multiplier effect for Government Expenditures. If you just want to fix this negative gap, how much Government expenditure would you propose? Same role, Using the AD/AS model, what would you expect to be the result of your proposal in the above question, with regard to output, and inflation? Does the degree of the shape of the AD/AS…
In the economy depicted in the graph, what happens if there is no intervention from policy makers? Use the graph, where LRAS represents long-run aggregate supply, SRAS represents short-run aggregate supply, and AD represents aggregate demand, to demonstrate the answers by shifting the appropriate curve or curves. Prices will decrease. increase. Output will decrease. increase. Aggregate price level (P) LRAS Real output (Q) SRAS AD
>>>Use the Aggregate supply and Aggregate Demand Model below to answer the questions that follow. Aggregate Supply and Aggregate Demand Model Examine the influence of government expenditure on investment in a nation. Use Jot Inc. Ltd a multinational construction company in which you are the Chief Exec of the firm that is highly diversified and recieves funds to construct highways and other government funded projects. Also, explain the factors that cause the Aggregate Demand curve to be downward sloping left to right.
Please Define Aggregate supply in no more than 3 lines
Which of the following is likely to result from a rapid rise in aggregate demand? Select one: a. Static living standards b. Increased unemployment c. Rising prices d. Surplus on the balance of payments

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