ament Score: 37.6% Resources Lx Give Up? Hint on 4 of 15 <. Suppose that the dynamic aggregate demand curve in Swaziland is determined by the equation M+ D= 6%. Using this information, draw Swaziland's dynamic aggregate demand curve on the graph. 13 Aggregate demand 12 11 10 8. 9. 4. 1. -3 -2 -1 0. 2. 3. Real GDP growth rate 5. 6. 10 4. 4. 7. 14 Inflation rate
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Q: Moving to another question will save this response. Question 24 A leftward shift in aggregate supply…
A: A leftward shift in AS that is a result of decrease in aggregate supply.
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Q: Suppose that the dynamic aggregate demand curve in Swaziland is determined by the equation M + U-6%.…
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Q: L Moving to another question will save this response. Question 10 Price Level P3 P2 P₁ Y₁ LRAS Y₂ an…
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A:
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Q: Question 4 Refer to the information provided in Figure 12.1 below to answer the questions that…
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- 18 - : If aggregate demand increases in an economy while aggregate demand is constant in the short run, which of the following statements is correct for the new equilibrium point?A) price decreases and national income increasesB) price rises national income risesC) price increases and national income does not changeD) price goes up and national income goes downE) price decreases and national income decreases.19 - : In which of the following expressions is the equation of change given correctly?A) MV=VK B) MT=PV C) MV=PT D) MP=VY E) MV=PComment, on the likely outcome with sufficient arguments? a) Impact on aggregate demand of the economy if imports are greater than exports.b) Impact on aggregate demand if the GDP of trading partner is increasing at a faster rate than that of India.c) Inflation rate in the country has reached 6.73%.Suppose firms become optimistic about futurebusiness conditions and invest heavily in new capitalequipment.a. Draw an aggregate-demand/aggregate-supplydiagram to show the short-run effect of thisoptimism on the economy. Label the new levels ofprices and real output. Explain in words why theaggregate quantity of output supplied changes.b. Now use the diagram from part (a) to show thenew long-run equilibrium of the economy. (Fornow, assume there is no change in the long-runaggregate-supply curve.) Explain in words whythe aggregate quantity of output demanded changesbetween the short run and the long run.c. How might the investment boom affect thelong-run aggregate-supply curve? Explain.
- Assume an economy operates in the intermediaterange of its aggregate supply curve. State thedirection of shift for the aggregate demandor aggregate supply curve for each of thefollowing changes in conditions. What is theeffect on the price level? On real GDP? Onemployment?a. The price of crude oil rises significantly.b. Spending on national defense doubles.c. The costs of imported goods increase.d. An improvement in technology raises laborproductivity.Based on the below information, help Renwick economy find the equilibrium level of output. Aggregate Demand Aggregate Supply Equilibrium YAD = C + I + G YAS = A Kα L1-α YR =0.5YAD+ 0.5YAS C = 600 + βYD A = (1 + g) Ao YD = YR + TR - tYR K = 35 TR = 55 L = 80 G = 120 g = 6% I = 50 Ao = 150 t = 0.15 α = 0.65 Where C is private consumption, YD is disposable income; TR, G and I are transfer payments, government spending and total investment, respectively. A in the index of technology and K and L are capital and labour inputs. A0 is the initial levels of A and L, both assumed to be 150, while g is the growth rates. The MPC is 0.60. a.) Find aggregate demand…Suppose that the economy's long-run output level is produces accourding to the following production funciton: Y= AK^1/2L^1/2 (will attach picture of the function) and that A = 5, K = 400 and L = 100 A. What is the economic meaning of the powers of K and L? B. What is the level of output ? produced when the economy in long-run equilibrium. C. Suppose that aggregate demand in the economy is described by the following equation:Y^d = m/kP Where M is the money supply, P is the price level and k = 1/V (velocity of money). Explain carefully where this equation is derived from and its interpretation D. Suppose that M = 2000 and that k = 2. What is the price level P at which the economy is in long-run- equilibrium? Plot such an equilibrium on a diagram with P on the vertical axis and Y on the horizontal axis, by distinguishing between the short-run and the long-run equilibrium. E. Now suppose that starting from the equilibrium of (b) and (c), the Central Bank increases M to 3000. Calculate…
- Consider the following actual and forecast demandlevels for Big Mac hamburgers at a local McDonald’s restaurant:DAY ACTUAL DEMAND FORECAST DEMANDMonday 88 88Tuesday 72 88Wednesday 68 84Thursday 48 80FridayThe forecast for Monday was derived by observing Monday’sdemand level and setting Monday’s forecast level equal to this demand level. Subsequent forecasts were derived by using expo-nential smoothing with a smoothing constant of 0.25. Using this exponential smoothing method, what is the forecast for Big Macdemand for Friday?Question 01 Due to COVID-19 situations the oil prices fall in international market. Let’s assume that output starts at its natural level. What happens to the country A's economy (output and price) in the short run? Explain your answer using AS-AD graphs.1-What is the general relationship between a country's price level and the quantitiy of it's domestic output (Real GDP) demanded? Who are the buyers of real US GDP? 2- what assumptions cause the immediate -short-run aggregate supply curve to be horizontal? why is the long-run aggregate supply curve vertical? Explain the shape of the short-run aggregate supply curve . Why is the short-run curve relatively flat to the left of the full employment output and relatively steep to the right ? 3- why does a reduction in aggregate demand tend to reduce real output, rather than the price level? 4- Explain" unemployment can be caused by a decrease of aggregate demand or a decrease of aggregate supply ."In each case , specify the price level outcomes . 5- In early 2001 investment spending declined in the USA. In the 2 months follwing september , 11 2001 attacks on the US, consumption also declined . Use Ad-AS analysis to show the two impacts on Real GDP. 6- Using the concept of the multiplier ,…
- 3. Did the Covid-19 recession shift the aggregate supply (AS) curve? If so, how?Please no written by hand solution Consider the following economic situations:C = $4.0 trillionI = $1.5 trillionG = $3.0 trillionT = $3.0 trillionNX = $1.0 trillionF = 0mpc = 0.8d = 0.35x = 0.15r = 1% λ = 0.5A. Calculate an expression for the IS, MP and AD curves ( r= ?, IS Y= ?, AD Y=?)B. Let AS curve be given by the relation: π = 6 + 1.5 (Y - 25.5) (i.e. the price shock is zero). What are the equilibrium values of inflation, output and the real interest rate(π, Y, r)?C. Suppose government purchases are raised from $3.0 trillion to $3.5 trillion. What are new short-run equilibrium inflation values, output and the real interest rate (π, Y, r}?D. Suppose a financial crisis begins, and ƒ increases ƒ = 3. (Assume government purchases are again as in part (a). What are the new short-run equilibrium values of inflation, output, and the interest rate (π, Y, r}?(Please solve all the parts with numerical steps so it could be practiced easily)Real GDP Real GDPDemanded, Price Level Supplied,Billions (Price Index) Billions$100 300 $450200 250 400300 200 300400 150 200500 100 100 Use these sets of data to graph the aggregate demandand aggregate supply curves. What is the equilibriumprice level and the equilibrium level of real output inthis hypothetical economy? Is the equilibrium real output also necessarily the full-employment real output?Explain.b. Why will a price level of 150 not be an equilibriumprice level in this economy? Why not 250?c. Suppose that buyers desire to purchase $200 billion ofextra real output at each price level. Sketch in the newaggregate demand curve as AD1. What factors mightcause this change in aggregate demand? What is thenew equilibrium price level and level of real output?
