The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Question

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Answer 1

Question

Chapter 20, Problem 1QR

To determine

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Expert Solution & Answer

Explanation of Solution

During the period of a recession, the economy will face the leftward shift in the Aggregate Demand and Aggregate Supply of the economy. When the AD and AS shifts leftwards, it would lead to the new equilibrium where the equilibrium output will be lower whereas the price level will be higher. Thus, during the period of recession in the economy, the real GDP of the economy and the investment spending or the consumption spending of the economy would fall which will lead to an increase in the unemployment of the economy.

Thus, the real GDP of the economy, the consumption spending and the investment spending would decline during the period of recession in the economy. The macroeconomic variable that increases during the period of recession is the unemployment rate.

Economics Concept Introduction

Concept introduction:

Economic fluctuations: They are the fluctuations in the level of national income of an economy which represents the growth or contraction in the economy in a financial year.

Recession: It is one important phase in the business cycle. This phase is the movement of the economy from the peak point of prosperity towards the depression which is the lower point of the economic business cycle.

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Answer 2

Question

Chapter 20, Problem 1QR

To determine

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Expert Solution & Answer

Explanation of Solution

During the period of a recession, the economy will face the leftward shift in the Aggregate Demand and Aggregate Supply of the economy. When the AD and AS shifts leftwards, it would lead to the new equilibrium where the equilibrium output will be lower whereas the price level will be higher. Thus, during the period of recession in the economy, the real GDP of the economy and the investment spending or the consumption spending of the economy would fall which will lead to an increase in the unemployment of the economy.

Thus, the real GDP of the economy, the consumption spending and the investment spending would decline during the period of recession in the economy. The macroeconomic variable that increases during the period of recession is the unemployment rate.

Economics Concept Introduction

Concept introduction:

Economic fluctuations: They are the fluctuations in the level of national income of an economy which represents the growth or contraction in the economy in a financial year.

Recession: It is one important phase in the business cycle. This phase is the movement of the economy from the peak point of prosperity towards the depression which is the lower point of the economic business cycle.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 20, Problem 1QR

To determine

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Expert Solution & Answer

Explanation of Solution

During the period of a recession, the economy will face the leftward shift in the Aggregate Demand and Aggregate Supply of the economy. When the AD and AS shifts leftwards, it would lead to the new equilibrium where the equilibrium output will be lower whereas the price level will be higher. Thus, during the period of recession in the economy, the real GDP of the economy and the investment spending or the consumption spending of the economy would fall which will lead to an increase in the unemployment of the economy.

Thus, the real GDP of the economy, the consumption spending and the investment spending would decline during the period of recession in the economy. The macroeconomic variable that increases during the period of recession is the unemployment rate.

Economics Concept Introduction

Concept introduction:

Economic fluctuations: They are the fluctuations in the level of national income of an economy which represents the growth or contraction in the economy in a financial year.

Recession: It is one important phase in the business cycle. This phase is the movement of the economy from the peak point of prosperity towards the depression which is the lower point of the economic business cycle.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 20, Problem 1QR

To determine

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Expert Solution & Answer

Explanation of Solution

During the period of a recession, the economy will face the leftward shift in the Aggregate Demand and Aggregate Supply of the economy. When the AD and AS shifts leftwards, it would lead to the new equilibrium where the equilibrium output will be lower whereas the price level will be higher. Thus, during the period of recession in the economy, the real GDP of the economy and the investment spending or the consumption spending of the economy would fall which will lead to an increase in the unemployment of the economy.

Thus, the real GDP of the economy, the consumption spending and the investment spending would decline during the period of recession in the economy. The macroeconomic variable that increases during the period of recession is the unemployment rate.

Economics Concept Introduction

Concept introduction:

Economic fluctuations: They are the fluctuations in the level of national income of an economy which represents the growth or contraction in the economy in a financial year.

Recession: It is one important phase in the business cycle. This phase is the movement of the economy from the peak point of prosperity towards the depression which is the lower point of the economic business cycle.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 20, Problem 1QR

To determine

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Expert Solution & Answer

Explanation of Solution

During the period of a recession, the economy will face the leftward shift in the Aggregate Demand and Aggregate Supply of the economy. When the AD and AS shifts leftwards, it would lead to the new equilibrium where the equilibrium output will be lower whereas the price level will be higher. Thus, during the period of recession in the economy, the real GDP of the economy and the investment spending or the consumption spending of the economy would fall which will lead to an increase in the unemployment of the economy.

Thus, the real GDP of the economy, the consumption spending and the investment spending would decline during the period of recession in the economy. The macroeconomic variable that increases during the period of recession is the unemployment rate.

Economics Concept Introduction

Concept introduction:

Economic fluctuations: They are the fluctuations in the level of national income of an economy which represents the growth or contraction in the economy in a financial year.

Recession: It is one important phase in the business cycle. This phase is the movement of the economy from the peak point of prosperity towards the depression which is the lower point of the economic business cycle.

Answer 6

Chapter 20, Problem 1QR

To determine

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Expert Solution & Answer

Explanation of Solution

During the period of a recession, the economy will face the leftward shift in the Aggregate Demand and Aggregate Supply of the economy. When the AD and AS shifts leftwards, it would lead to the new equilibrium where the equilibrium output will be lower whereas the price level will be higher. Thus, during the period of recession in the economy, the real GDP of the economy and the investment spending or the consumption spending of the economy would fall which will lead to an increase in the unemployment of the economy.

Thus, the real GDP of the economy, the consumption spending and the investment spending would decline during the period of recession in the economy. The macroeconomic variable that increases during the period of recession is the unemployment rate.

Economics Concept Introduction

Concept introduction:

Economic fluctuations: They are the fluctuations in the level of national income of an economy which represents the growth or contraction in the economy in a financial year.

Recession: It is one important phase in the business cycle. This phase is the movement of the economy from the peak point of prosperity towards the depression which is the lower point of the economic business cycle.

Answer 7

Chapter 20, Problem 1QR

To determine

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Answer 8

Expert Solution & Answer

Explanation of Solution

During the period of a recession, the economy will face the leftward shift in the Aggregate Demand and Aggregate Supply of the economy. When the AD and AS shifts leftwards, it would lead to the new equilibrium where the equilibrium output will be lower whereas the price level will be higher. Thus, during the period of recession in the economy, the real GDP of the economy and the investment spending or the consumption spending of the economy would fall which will lead to an increase in the unemployment of the economy.

Thus, the real GDP of the economy, the consumption spending and the investment spending would decline during the period of recession in the economy. The macroeconomic variable that increases during the period of recession is the unemployment rate.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Concept introduction:

Economic fluctuations: They are the fluctuations in the level of national income of an economy which represents the growth or contraction in the economy in a financial year.

Recession: It is one important phase in the business cycle. This phase is the movement of the economy from the peak point of prosperity towards the depression which is the lower point of the economic business cycle.

Answer 12

Ch. 20.1 - Prob. 1QQ Ch. 20.2 - Prob. 2QQ Ch. 20.3 - Prob. 3QQ Ch. 20.4 - Prob. 4QQ Ch. 20.5 - Prob. 5QQ Ch. 20 - Prob. 1QR Ch. 20 - Prob. 2QR Ch. 20 - Prob. 3QR Ch. 20 - Prob. 4QR Ch. 20 - Prob. 5QR

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Solution Summary: The author explains that economic fluctuations are the fluctuations in the level of national income of an economy which represent the growth or contraction in a financial year.

The macroeconomic variables that would decline during recession and one variable that would rise during recession.

Explanation of Solution

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