Long run aggregate supply is the relationship between the quantity of real GDP s maintain full employment. O A. interest rate O B. real wage rate O C. money wage rate O D. quantity of money Short-run aggregate supply is the relationship between the quantity of potential GDP remain constant suppl O A. potential GDP, price level O B. real GDP: price level O C. nominal GDP, exchange rate O D. real GDP, interest rate

Q: Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household…

A: * answer :-  A)

Q: a. How much does aggregate demand need to change to restore the economy to its long run equilibrium?…

A: The aggregate demand curve would result in the downward sloping curve which has a relation between…

Q: Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household…

A: Aggregate demand is a total demand for final goods and services in the domestic economy at a…

Q: What happens on the aggregate demand curve when there is a rise in the price level which causes a…

A: Answer-

Q: the equation of exchange is given by M x V-PxQ, where M is the money supply, V is the velocity of…

A: The measure that depicts the final value of goods and services in an economy during a specified span…

Q: 13) Which of the following would cause the United State's aggregate demand curve to shift to the…

A: The economies in the world operate upon the basis of the economic activities which are done by…

Q: True of False? In the short run, stock market returns always align with macroeconomic performance…

A: 1. As a general rule, the stock markets in an economy are directly correlated with the GDP of the…

Q: (03.08 MC) What will be impact of an income tax increase on an economy's consumption spending, real…

A: * ANSWER :-  As per guidelines I answered one (1st) question only please  understood. * The OPTION A…

Q: Which of the following both shift aggregate demand right? O A. net exports rise for some reason…

A: Change in the price level causes movement along the demand curve. Change in factors other than the…

Q: : Which of the following statements is true if there is an increase in aggregate demand while the…

A: Aggregate demand: The term aggregate demand refers to the situation under which the demand for a…

Q: Assume there is no government or foreign sector. If the multiplier is 2, a $20 billion increase in…

A: The correct answer is option d. The aggregate output will increase by $40 billion.  Change in…

Q: The short-run aggregate supply curve has: O A. a positive slope because as the inflation rate…

A: Aggregate supply curve refers to the graphical representation of the connection between output…

Q: IS curve: r = 30.30-0.0015Y LM curve: =Y - 500(r + n°) SRAS curve: Y = Y + 100(P – P°) The nominal…

A: The IS-LM model describes how aggregate markets for real goods and financial markets interact to…

Q: The export component of GDP is a variable; core PPI is a variable. Select one: OA. stock; stock O B.…

A: Both GDP and core PPI are flow variable. Therefore answer is (C).

Q: Which of the following would shift aggregate demand to the left? O a) Stock market values increase…

A: Aggregate demand is the sum of consumption, investment, government spending, and net exports.  An…

Q: Suppose that foreigners had increased confidence in U.S. financial institutions and believed that…

A: In Keynesian economics, the changes in aggregate demand are able to change the output level and…

Q: Figure 10.2 AS Pz AD2 P1 AD: Y2 In Figure 10.2: O the steepness of the aggregate supply curve…

A: In the given graph, aggregate demand curves and the aggregate supply curve is given for a specific…

Q: Which of following help explain the negative slope of the aggregate demand curve? Select one: a. A…

A: The aggregate demand curve shows the quantity of real GDP demanded in the economy at the different…

Q: Automatic stabilisers imply: Select one: O a. an automatic increase in government spending or…

A: Automatic stabilizers offset the fall in real GDP when the economy contracts, and offset the rise in…

Q: When the economy is in a recession, tax revenue while spending increases and, as a result, aggregate…

A: Recession is the economic phase where the production level is low and economic activities are…

Q: Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household…

A:

Q: When there ae no unplanned inventory changes, the economy in a short run equilibrium and in a long…

A: In an economy, unplanned inventory refers to the amount of output that left unsold withthe sellers.

Q: A rise in the money wage rate shifts the O A. potential GDP curve rightward. O B. AS curve…

A: The correct option is B That is AS curve rightward.

Q: Refer to Figure 9.1. Assume the economy is initially at point A. The eventual change from a shock…

A: 1. In Short run, Equilibrium occurs when Aggregate Demand(AD) and short run aggregate supply(SRAS)…

Q: Consider the following economy: Labor supply: Nt= 90 Capital stock: Kt = 90 Government spending: Gt…

A: Sorry as per policy only 3 sub parts of the question are answered at a time .   Equilibrium in…

Q: Notice that real GDP trends upward over time but experiences ups and downs in the short run. These…

A: Hi ! Thank you for the question. we are authorized to answer three subparts at a time. Since you…

Q: How does a real appreciation affect the quantities of imports and exports? Select one: O a. Imports…

A: The increase in dollar deposit in bank increases the reserve of bank ie creating more  money supply…

Q: 8. Suppose that aggregate demand and supply for a hypothetical economy are as shown: P TITIX Amount…

A: Economic equilibrium is a state in which economic factors such as supply and demand are balanced,…

Q: A correctly anticipated increase in the quantity of money, in an economy with an unchanging long-run…

A:

Q: If wages adjust fully to price increases in the long run, fiscal policy will Select one: O a. have…

A: In long run, as wages adjust, we have changes in aggregate supply, thus output reaches to its…

Q: Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household…

A: We are going to use Output relation with government expenditure, Private consumption, Investment for…

Q: If long-range aggregate supply (LRAS) shifts right, we know for certain that there has been O a) an…

A: Long run aggregate supply is the vertical line which shows that economy can't produce further the…

Q: .The natural level of real GDP is that level of O real GDP at which the price level will continue…

A: The gross domestic product(GDP) of an economy is defined as the market value of all the final…

Q: Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household…

A: Answer: It is given that for a 1% increase in household wealth the consumer spending will increase…

Q: Which of the following is true of a recessionary gap? O a. In the long run, this gap closes when the…

A: When talking about recessionary gap, it is the situation when an economy is experiencing relatively…

Q: What is the effect of a rise in the money wage rate when the economy is at potential GDP? A rise in…

A: The payments done to workers in money form are known as money wage. It don’t realize of inflation…

Q: Price level (GDP price Index 2012-100) Pocential AS 130 GDP 120 110 100 90 AD 19.0 195 20.0 20.5…

A: Current level of equilibrium is reached at the intersection of AD and AS. Long run equilibrium is…

Q: In the long run, the government budget will add to sustained inflation if... O a. Deficits are…

A: Deficit financing means generating funds to finance the deficit which results from excess of…

Q: A country's economy is close to full employment. The government then decides to launch a tax cut…

A: The economy is at full employment when it uses all its resources efficiently.

Q: Suppose that the economy is presently operating at ful employment. If there is an increase in…

A: In economics, the full employment level or the potential GDP level is achieved when all the…

Q: Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household…

A: Aggregate supply refers to the total supply available the market in a specific time period.…

Q: What are the effects of a decrease in the price level? Select one: O a. The real interest rate…

A: In an economy, any change in inflation or price level will lead to change the value of the currency…

Q: How does a real appreciation affect the quantities of imports and exports? Select one: O a. Imports…

A: Answer:  Real appreciation means the real exchange rate of a country increases. Due to this, the…

Q: : Which of the following statements is true if there is an increase in aggregate demand while the…

A: Meaning of Aggregate Demand and Aggregate Supply: The term aggregate demand refers to the…

Q: In order to shift the vertical aggregate supply curve to the left, which of the following would have…

A: The long-run aggregate supply (LRAS) curve depicts the real output level (or the potential level of…

Q: Suppose that the aggregate demand and aggregate supply schedules for a hypothetical economy are as…

A: The equilibrium is where the aggregate demand is equal to aggregate supply, i.e. where both the…

Q: Describe the short-run aggregate supply (SRAS) curve and the long-run aggregate supply (LRAS) curve.…

A: Aggregate supply curve: It represents the relationship between the level of prices and the quantity…