How do Classical and Keynesian economists differ in their view of the aggregate supply curve?

Q: Why unemployment results when Aggregate Demand is lesser than Aggregate Supply in the economy?

A: Aggregate demand refers to the total demand for the finished goods and services in an economy—the…

Q: Which of the following statements concerning the aggregate demand and aggregate supply model is…

A: Aggregate supply is the cumulative quantity supplied in a market that businesses can offer at a…

Q: Can you explain how expectations about future prices and incomes will affect consumption?

A: Consumption measures the total consumption spending by the households on different goods and…

Q: How was the aggregate supply curve different from the supply curve for single good like pizza?

A: Aggregate supply curve shows the response of the aggregate supply to the fluctuations in the price…

Q: If the economy is experiencing unemployment, the most appropriate government action to shift the…

A: Unemployment refers to a situation where the workers are ready to offer their labor at the existing…

Q: How do changes in government spending and taxes affect the equilibrium price level and real GDP?

A: In an economy, equilibrium level of real GDP is determined by the intersection of aggregate demand…

Q: How does each of the following infrastructure items affect aggregate supply?   courts and prisons.

A: Aggregate supply is the total quantity of goods and services produced in an economy.

Q: What factors affect aggregate demand?

A: Aggregate demand sums the desired quantity demanded of final commodities and services by different…

Q: What determines aggregate supply in the short run and what determines it in the long run?

A: Aggregate supply refers to the whole quantity of products and services generated within an economy…

Q: Aggregate demand and aggregate supply.  Aggregate demand and aggregate supply can be influenced by…

A: AD or aggregate demand is the sum of all the demands of finished goods in an economy. It depicts the…

Q: To support the economy against a recession triggered by the Coronavirus, the government is…

A: Goods Market Equilibrium Condition - IS relation : Y = C + I + G + NX Where , C = c0 + c1(Y - T )  C…

Q: How does it help to explain the downward slope of the aggregate demand cure?

A: Aggregate demand refers to a total value of finished goods and services demanded in an economy…

Q: Why can't an economy generate its own aggregate demand when needed?

A: A system for creating, distributing, and consuming goods is referred to as an economy. The producers…

Q: Fiscal policy consists of intentional changes in the government's spending levels or tax policies…

A: If the government increases spending,government expenditure will increase. Therefore aggregate…

Q: Which of the following leads to a rightward shift in the aggregate demand? a. General price level…

A: We know that aggregate demand is the sun of consumption spending , investment spending , government…

Q: A movement up a given aggregate demand curve is the result of

A: Demand is regarded as an economic principle which refers to a consumers desire to buy goods and…

Q: Which of the following is a major influence on Aggregate Supply? Select one: a. The advice of…

A: Aggregate supply (AS) is the total supply of the goods and services available into the market from…

Q: Define what economists mean when they use the word: “recession”?

A: GDP is used to measure total income in the economy.   It is the value of final goods and services…

Q: a) In the classical model, what is the impact of changes in the demand for goods and services on…

A: The classical model argues that the economy is always at the full employment level and the prices…

Q: What relationship does the short-run aggregate supply curve represent?

A:

Q: Identify factors that would cause consumption spending to increase. What effect would that have on…

A:

Q: From the perspective of someone using aggregate-demand and aggregate supply analysis, what is the…

A: Full employment is the situation where all the resources are fully utilized.

Q: aggregate supply

A: Out of the two, short term aggregate supply is more realistic and reflects the actual scenario of…

Q: What effects would  increase in aggregate supply have on price levels and GDP?

A: In economics, the aggregate supply level is a concept which measures the level of total output or…

Q: the definition and examples of aggregate demand?

A: Aggregate demand: Aggregate demand is up to a nation's gross domestic product (GDP) within the…

Q: a) Distinguish between the classical and the Keynesian aggregate supply curve

A: Aggregate supply curve: it shows the relationship between the amount of output supplied by firms at…

Q: What are 3 ways in which aggregate supply could decrease in an economy?

A: AGGREGATE SUPPLY Aggregate supply is cumulative of goods and services produced in an economy in a…

Q: Draw the aggregate demand model and show how government spending impacts the model. Please label the…

A: Government spending has a direct relationship with the level of output. An increase in government…

Q: According to the classical economists, the supply curve is vertical at the level of potential GDP.…

A: In the aggregate demand (AD) and the aggregate supply (AS) model, the supply curve is vertical at…

Q: If savings is greater than investment, what is the implication for aggregate demand? Explain.

A: If saving rises then it means that there will be decline in consumption. the decrease in consumption…

Q: e following graph shows the aggregate demand (AD) and aggregate supply (AS) curves for a…

A: At equilibrium point aggregate demand and aggregate supply are equal  at certain price level. And…

Q: If the economy’s labor force is increasing and also becoming more productive, what will happen to…

A: The whole supply of goods and services produced within an economy at a certain overall price in a…

Q: how a decrease in government spending on infrastructure affect the aggregate demand curve?

A: In an economy, government spending is one of the components of aggregate demand that is included…

Q: A neoclassical economist and a Keynesian economist are studying the economy of Vineland. It appears…

A: Keynesian economists believe that there is nothing like invisible hand theory. It means that many…

Q: Three ways to increase Consumption which would cause a shift right in the AD curve would be or or

A: At different price levels, the aggregate demand curve depicts the total quantity of all commodities…

Q: Why does the economy's aggregate demand curve have a negative slope?

A: Three reasons that show the Aggregate Demand curve is downward sloping (or have a negative slope):…

Q: Which of the following would not shift the aggregate demand curve to the left? Group of answer…

A: The aggregate demand (AD) curve is a line exhibiting the relationship between total units demanded…