Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 8.5, Problem 2ST
To determine
Describe an economy that is neither short-run nor long-run equilibrium.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Define equilibrium and steady state. Can we find a steady state for each dynamic general
equilibrium model? Why or why not?
Starting from long-run equilibrium, graphically illustrate and explain what happens to RGDP, the average price level, and unemployment if consumer confidence decreases.
A production possibilities curve (PPC) represents the maximum amount of two goods or services produced by manufacturers in an economy.
How are the PPC and long-run aggregate supply curve similar?
Chapter 8 Solutions
Economics (MindTap Course List)
Ch. 8.2 - Prob. 1STCh. 8.2 - Prob. 2STCh. 8.2 - The money supply has risen, but total spending has...Ch. 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
Knowledge Booster
Similar questions
- Suppose that the government believes the economy is not producing goods and services at its optimal level. In an attempt to stimulate the economy, the government increases the quantity of money in the economy by printing more money. This monetary policy the economy's demand for goods and services, leading to product prices. In the short run, the change in prices induces firms to produce goods and services. This, in turn, leads to a level of unemployment. In other words, the economy faces a trade-off between inflation and unemployment: Higher inflation leads to unemployment.arrow_forwardwhy is the economy not self-correcting? What can be done about it?arrow_forwardIf markets do not self-adjust, how can a decline in spending lead to a negative process that ruins an economy?arrow_forward
- Economic activity fluctuates in the short-run. Why is this the case? Please explainarrow_forwardAn economy is described by the following: C=20+0.9Y I=120-200r Md=250+0.2Y-400r Ms/P=1250 Y=70 W=17.5 Lf=144 a) Find agregate supply and agregate demand. b) Find the equilibrium level of Y and P. c) Graphically represent this economy. d) Find the long-run Y of this economy. e) What is the level of government expenses G, the government needs to impose in order to lead the economy to the full employment? (Show the long-run graphically).arrow_forwardSuppose that an economy wants to boost available labor hours in order to increase aggregate supply. What is the best way to accomplish this?arrow_forward
- The government of Prime Minister Shinzo Abe said it would offer some $15 billion in financing for businesses hit by the novel coronavirus and spend about $4 billion directly to prop up the economy.“As the top priority for the time being, we have to put all our effort into keeping businesses alive,” Mr. Abe said.Still, in a $5 trillion economy, the measures may not be big enough to dig the country out of a big hole. SMBC Nikko Securities economist Junichi Makino said he expected the Japanese economy to shrink at an annualized pace of 5.8% in the January-to-March period following a 7.1% contraction in the last quarter of 2019.Japan is set to offer emergency no-interest loans of about $1,900 to newly jobless people and others in trouble, and the borrowers may not have to pay the money back if they can’t find work. Businesses at risk from the virus can access financing or loan guarantees from the government QUESTIONS: 1. How would the financing plan designed to supports businesses impact the…arrow_forwardWhen the economy is creating less output than its potential, it means: Multiple Choice о O о O contractionary policy needs to be enacted. the government will reduce its spending. the economy is expanding. some resources are unemployed.arrow_forwardDraw the graph (aggregate supply and aggregate demand curves) of an economy that is in equilibrium.arrow_forward
- Which of the following is an example of a topic studied in macroeconomics? The costs of production in a firm How consumers react to higher gasoline prices The growth in total output of an economyarrow_forwardCould you say that the consumers are a significant aspect of an economy? If so, why?arrow_forwardAre all prices in the economy equally inflexible? Which ones show large amounts of short-run flexibility?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
- Macroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningEconomics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning