34) Unemployment would increase and prices would decreaseifaggregate demand shiftedleftaggregate demand shiftedrightaggregate supply shifted leftaggregate supply shiftedright

When the aggregate demand is decreasing, it shifts leftward and the price level decreases. Since the…

Answered: 34) Unemployment would increase and…

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter5: Introduction To Macroeconomics

Section: Chapter Questions

Problem 3.3P

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19. Which action would cause the aggregate supply curve slope to change in the short run? A. high income taxes B. changes in profit C. shortages in a specific market D. free market
6. Macroeconomic equilibrium is defined as ___. A. The point at which the supply curve and demand curve in a specific market for good meet. B. The point where a nation’s aggregate demand equals its aggregate supply. C. The point where quantity demanded and quantity supplied are equal to one another in a market for goods. D. When a nation meets its GDP goals.
Suppose the economy is operating at potential GDP when It experiences an increase in export demand. How might the economy increase production of exports to meet this demand, given that the economy is already at full employment?
Describe the mechanism by which demand creates its own supply.
Suppose that a 5 increase in the minimum wag causes a 5 reduction in employment. How would this affect employment and how would it affect workers? In your opinion, would this be a good policy?
10. Which of the following would cause the Aggregate Quantity Demanded to increase? a) An increase in the price level causing an increase in the purchasing power of the consumer's wealth b) A decrease in the price level making domestic prices less expensive relative to foreign prices c) An increase in the price level causing an increase in the market rate of interest d) A decrease in the price level causing a decrease in the purchasing power of the consumers' wealth e) None of the above
What is ? 1-)Required Reserve 2-)Aggregate Supply 3-)Aggregate Dernand
Section: Unanticipated Changes, Recessions, and Booms; How an economy self-adjusts to full-employment equilibrium without government intervention: Source--Gwartney Section 10-7 A. Draw an Aggregate Supply/Aggregate Demand graph of an economy that is initially in Long-Run Equilibrium. B. Next, on your graph, display the short-run impact of an abrupt decrease in Aggregate Demand.
Please no written by hand solution Assume that the potential GDP of the economy of Arion is $1,160, and that the aggregate demand and aggregate supply are as shown in the following table. Aggregate Quantity Demanded 1 Aggregate Quantity Demanded 2 Price Index Aggregate Quantity Supplied $1,240 96 $1,000 1,220 97 1,040 1,200 98 1,080 1,180 99 1,120 1,160 100 1,160 1,140 101 1,200 1,120 102 1,240 1,100 103 1,270 1,080 104 1,300 1,060 105 1,330 a. The value of equilibrium real GDP is and the price level is . There is (Click to select) gap. The gap is equal to $ . b. If firms become more optimistic and aggregate demand increases by $60, complete the aggregate demand 2 column in the table above. c. The new value of equilibrium real GDP is and the price level is now . d. There is (Click to select) gap. The gap is equal to $ .
Subject :- Economy Consider a scenario of a closed economy in the short run where price level is fixed. Assume that both taxes and money supply increase in a way that keep output constant in equilibrium (suppose that the marginal propensity to consume is less than one). Which of the following may result from the policy change? a) It will lead to an increase in investment but a decrease in consumption. b) It will result in an increase in investment but a decrease in government spending. c) It will lead to an increase in investment and private saving. d) It will decrease investment but increase in public saving
Refer to the table below. Real Output Demanded, Billions Price Level Real Output Supplied, Billions $ 506 108 $ 513 508 104 512 510 100 510 512 96 507 514 92 502 Instructions: Enter your anwers as whole numbers. A). What is the equilibrium level of output? What is the equilibrium price level? B). Suppose that aggregate demand increases such that the amount of real output demanded rises by $ 7 billion at each price level. Insert the new values for real output demanded in the table below. Real Output Demanded, Billions New Real Output Demanded, Billions Price Level Real Output Supplied, Billions $ 506 108 $ 513 508 104 512 510 100 510 512 96 507 514 92 502 What is the new equilibrium level of output? What is the new equilibrium price level? By what percentage will the price level increase? Will this inflation be demand-pull inflation or will it be cost-push inflation? C) If potential real GDP ( that is, full-employment GDP) is $ 510…
Explain why the following statements are false.a. “The aggregate-demand curve slopes downwardbecause it is the horizontal sum of the demandcurves for individual goods.”b. “The long-run aggregate-supply curve is verticalbecause economic forces do not affect long-runaggregate supply.”

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34) Unemployment would increase and prices would decrease if aggregate demand shifted left aggregate demand shifted right aggregate supply shifted left aggregate supply shifted right