Macroeconomics
13th Edition
ISBN: 9781337617390
Author: Roger A. Arnold
Publisher: Cengage Learning
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Question
Chapter 8.2, Problem 2ST
To determine
Explain the situation of AD curve if dollar appreciates.
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Chapter 8 Solutions
Macroeconomics
Ch. 8.2 - Prob. 1STCh. 8.2 - Prob. 2STCh. 8.2 - Prob. 3STCh. 8.3 - Prob. 1STCh. 8.3 - Prob. 2STCh. 8.3 - Prob. 3STCh. 8.5 - Prob. 1STCh. 8.5 - Prob. 2STCh. 8 - Prob. 1QPCh. 8 - Prob. 2QP
Ch. 8 - Prob. 3QPCh. 8 - Prob. 4QPCh. 8 - Prob. 5QPCh. 8 - Prob. 6QPCh. 8 - Prob. 7QPCh. 8 - Prob. 8QPCh. 8 - Prob. 9QPCh. 8 - Prob. 10QPCh. 8 - Prob. 11QPCh. 8 - Prob. 12QPCh. 8 - Prob. 13QPCh. 8 - Prob. 14QPCh. 8 - Prob. 15QPCh. 8 - Prob. 16QPCh. 8 - Prob. 17QPCh. 8 - Prob. 18QPCh. 8 - Prob. 19QPCh. 8 - Prob. 20QPCh. 8 - Prob. 21QPCh. 8 - Prob. 1WNGCh. 8 - Prob. 2WNGCh. 8 - Prob. 3WNGCh. 8 - Prob. 4WNGCh. 8 - Prob. 5WNGCh. 8 - Prob. 6WNG
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Similar questions
- Which of the following is likely to occur for the United States, if the U.S. dollar appreciates relative to the Japanese yen, Answers: A. Aggregate demand will increase (shift right). B. SRAS will decrease (shift left). C. Aggregate demand will decrease (shift left). D. LRAS will increase (shift right).arrow_forwardExplain how changes in exchange rates impact the economy through the aggregate demand- aggregate supply (AD/AS) model. Explain how fluctuations in exchange rates can influence loans and banks.arrow_forwardThe effect that a change in the price level has on a country's exports and imports is called the: Exchange rate effect. Interest rate effect. International effect. Multiplier effect.arrow_forward
- What happens to the price level and GDP if there is an increase in the exchange rate?arrow_forwardSuppose that the AD-SRAS-LRAS diagram for the economy is starting in a long-run equilibrium. Now if there is a recession in a trading partner country, which causes domestic aggregate demand to fall. What happens to the domestic output and the price level in the short run and long run, respectively? Elaborate on your answers in words.arrow_forwardHow can they say that "Rising prices are symptom of an expanding current supply"?arrow_forward
- How does an increase in foreign income affect domestic aggregate expenditures and demand?arrow_forwardThe graph below shows the AD-AS diagram for the US. Suppose that the economy is initially in long-run equilibrium with the price level of 700 (Red AD and SRAS curves). Now suppose that dollar depreciates. Price Level 1200 1100- 1000 900 800 700- 600* 500 400- 300- 200- 100 HITTE 100 200 300 400 500 Real GDP As a result of this event what is the new short-run price level? 600 700 800 900 1000 1100 120 Qarrow_forwardPlease use the AD-AS model to analyze the effects of monetary policy and fiscal policy on economic outcome in an open economy: a. Please show graphically the shifting of the AD curve after the Fed conducts an expansionary monetary policy in a closed economy (A closed economy means there is no international trade.). How do the price level and the real GDP change? b. Suppose the economy becomes an open economy. Please revise the result that you get in part (a). Please explain how you get the new result using the AD-AS model. c. Please show graphically the shifting of the AD curve after the federal government conducts an expansionary fiscal policy in a closed economy. Please show the crowding-out effect. How do the price level and the real GDP change? d. Suppose the economy becomes an open economy. Please revise the result that you get in part (c). Please explain how you get the new result based on the AD-AS model.arrow_forward
- What does it mean when the dollar appreciates compared to when the dollar depreciates? Has the US dollar been relatively strong or weak over the past year? How does the strength of the dollar affect exports and imports?arrow_forwardExplain the components of Current Accountsarrow_forwardSuppose world interest rates go up, driving the world into a recession (that is, world income falls). Use the AD-AS model to analyze how this affects prices and income in our national economy. Do your results depend on whether exchange rates are fixed or flexible?arrow_forward
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