Causes of the outward right shift in AS curve in the economy.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 27, Problem 1DQ

To determine

Causes of the outward right shift in AS curve in the economy.

Expert Solution & Answer

Explanation of Solution

The equilibrium in the economy is obtained at the intersection of the aggregate demand and the aggregate supply curve in the economy. When there is a decrease in the price of foreign oil in the economy, then there will be an increase in the profitability of the firm as the cost of purchase of the foreign oil decreases whereas the domestic price level remains the same. When the profit increases in the economy, then there will be an increase in the output which means that there will be a rightward shift in the AS curve in the economy. When the AS curve shifts towards the right, then there will be a decline in the price level in the economy whereas an increase in the output level in the economy which are the consequences of the shift in the AS curve.

Economics Concept Introduction

Equilibrium: The equilibrium is the point where the aggregate demand of the economy becomes equal to the aggregate supply of the economy. At this point, there will be no excess demand or excess supply in the economy and supplied products and services will be completely consumed by the consumers.

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!

Students have asked these similar questions

What kind of change would happen to aggregate demand, aggregate supply, and real GDP. if foreign countries purchase an unusually large number of U. S. manufactured passenger and military airplanes.

Is the following statement TRUE or FALSE? Please provide reason for the answer. The aggregate supply curve is shifted rightward by an increase in tax rates.

Is the following statement TRUE or FALSE? Please provide reason for the answer. A fall in the price level shifts the aggregate supply curve upward and decreases the quantity of real GDP supplied.

Answer 2

Question

Chapter 27, Problem 1DQ

To determine

Causes of the outward right shift in AS curve in the economy.

Expert Solution & Answer

Explanation of Solution

The equilibrium in the economy is obtained at the intersection of the aggregate demand and the aggregate supply curve in the economy. When there is a decrease in the price of foreign oil in the economy, then there will be an increase in the profitability of the firm as the cost of purchase of the foreign oil decreases whereas the domestic price level remains the same. When the profit increases in the economy, then there will be an increase in the output which means that there will be a rightward shift in the AS curve in the economy. When the AS curve shifts towards the right, then there will be a decline in the price level in the economy whereas an increase in the output level in the economy which are the consequences of the shift in the AS curve.

Economics Concept Introduction

Equilibrium: The equilibrium is the point where the aggregate demand of the economy becomes equal to the aggregate supply of the economy. At this point, there will be no excess demand or excess supply in the economy and supplied products and services will be completely consumed by the consumers.

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 3

Question

Chapter 27, Problem 1DQ

To determine

Causes of the outward right shift in AS curve in the economy.

Expert Solution & Answer

Explanation of Solution

The equilibrium in the economy is obtained at the intersection of the aggregate demand and the aggregate supply curve in the economy. When there is a decrease in the price of foreign oil in the economy, then there will be an increase in the profitability of the firm as the cost of purchase of the foreign oil decreases whereas the domestic price level remains the same. When the profit increases in the economy, then there will be an increase in the output which means that there will be a rightward shift in the AS curve in the economy. When the AS curve shifts towards the right, then there will be a decline in the price level in the economy whereas an increase in the output level in the economy which are the consequences of the shift in the AS curve.

Economics Concept Introduction

Equilibrium: The equilibrium is the point where the aggregate demand of the economy becomes equal to the aggregate supply of the economy. At this point, there will be no excess demand or excess supply in the economy and supplied products and services will be completely consumed by the consumers.

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 4

Question

Chapter 27, Problem 1DQ

To determine

Causes of the outward right shift in AS curve in the economy.

Expert Solution & Answer

Explanation of Solution

The equilibrium in the economy is obtained at the intersection of the aggregate demand and the aggregate supply curve in the economy. When there is a decrease in the price of foreign oil in the economy, then there will be an increase in the profitability of the firm as the cost of purchase of the foreign oil decreases whereas the domestic price level remains the same. When the profit increases in the economy, then there will be an increase in the output which means that there will be a rightward shift in the AS curve in the economy. When the AS curve shifts towards the right, then there will be a decline in the price level in the economy whereas an increase in the output level in the economy which are the consequences of the shift in the AS curve.

Economics Concept Introduction

Equilibrium: The equilibrium is the point where the aggregate demand of the economy becomes equal to the aggregate supply of the economy. At this point, there will be no excess demand or excess supply in the economy and supplied products and services will be completely consumed by the consumers.

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 27, Problem 1DQ

To determine

Causes of the outward right shift in AS curve in the economy.

Expert Solution & Answer

Explanation of Solution

The equilibrium in the economy is obtained at the intersection of the aggregate demand and the aggregate supply curve in the economy. When there is a decrease in the price of foreign oil in the economy, then there will be an increase in the profitability of the firm as the cost of purchase of the foreign oil decreases whereas the domestic price level remains the same. When the profit increases in the economy, then there will be an increase in the output which means that there will be a rightward shift in the AS curve in the economy. When the AS curve shifts towards the right, then there will be a decline in the price level in the economy whereas an increase in the output level in the economy which are the consequences of the shift in the AS curve.

Economics Concept Introduction

Equilibrium: The equilibrium is the point where the aggregate demand of the economy becomes equal to the aggregate supply of the economy. At this point, there will be no excess demand or excess supply in the economy and supplied products and services will be completely consumed by the consumers.

Answer 6

Chapter 27, Problem 1DQ

To determine

Causes of the outward right shift in AS curve in the economy.

Expert Solution & Answer

Explanation of Solution

The equilibrium in the economy is obtained at the intersection of the aggregate demand and the aggregate supply curve in the economy. When there is a decrease in the price of foreign oil in the economy, then there will be an increase in the profitability of the firm as the cost of purchase of the foreign oil decreases whereas the domestic price level remains the same. When the profit increases in the economy, then there will be an increase in the output which means that there will be a rightward shift in the AS curve in the economy. When the AS curve shifts towards the right, then there will be a decline in the price level in the economy whereas an increase in the output level in the economy which are the consequences of the shift in the AS curve.

Economics Concept Introduction

Equilibrium: The equilibrium is the point where the aggregate demand of the economy becomes equal to the aggregate supply of the economy. At this point, there will be no excess demand or excess supply in the economy and supplied products and services will be completely consumed by the consumers.

Answer 7

Chapter 27, Problem 1DQ

To determine

Causes of the outward right shift in AS curve in the economy.

Answer 8

Expert Solution & Answer

Explanation of Solution

The equilibrium in the economy is obtained at the intersection of the aggregate demand and the aggregate supply curve in the economy. When there is a decrease in the price of foreign oil in the economy, then there will be an increase in the profitability of the firm as the cost of purchase of the foreign oil decreases whereas the domestic price level remains the same. When the profit increases in the economy, then there will be an increase in the output which means that there will be a rightward shift in the AS curve in the economy. When the AS curve shifts towards the right, then there will be a decline in the price level in the economy whereas an increase in the output level in the economy which are the consequences of the shift in the AS curve.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Equilibrium: The equilibrium is the point where the aggregate demand of the economy becomes equal to the aggregate supply of the economy. At this point, there will be no excess demand or excess supply in the economy and supplied products and services will be completely consumed by the consumers.

Answer 12

Ch. 27 - Prob. 1DQ Ch. 27 - Prob. 2DQ Ch. 27 - Prob. 3DQ Ch. 27 - Prob. 4DQ Ch. 27 - Prob. 5DQ Ch. 27 - Prob. 1TY Ch. 27 - Prob. 2TY Ch. 27 - Prob. 3TY Ch. 27 - Prob. 4TY

Causes of the outward right shift in AS curve in the economy.

Causes of the outward right shift in AS curve in the economy.

Explanation of Solution

Want to see more full solutions like this?

Chapter 27 Solutions