ques6 OU can make a profit by keeping your product price 20% less than the monopolist.monopoly market. As per yourExplain, how the monopolist might react to stop you to enter the business?Answer:5. The real GDP per capita of many countries such as China and Korea are greater than that of the US.Does this indicate that these countries will eventually overtake the US in terms of the growth rate ofreal GDP per capita? Explain.Answer:6. As we all know that pandemic COVID -19 is creating the threat for the economic meltdown. Youare required to analyze this pandemic effects on the aggregate demand and aggregate supply ofCanadian economy.Answer7. If consumers save a larger portion of their income, what effect would this have on the output,employment, and price level in the short run and long run?Answer:8. The AD-AS model shows a snapshot of the economy at a given point in time. Both economic growthand inflation are dynamic phenomena. Suppose economic growth is 4%o per year and aggregatedemand is growing at the same rate. What does the AD/AS model say the inflation rate should be?

Answered: OU can make a profit by keeping your…

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Monopoly

Section: Chapter Questions

Problem 9PA

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ques6

OU can make a profit by keeping your product price 20% less than the monopolist.
monopoly market. As per your
Explain, how the monopolist might react to stop you to enter the business?
Answer:
5. The real GDP per capita of many countries such as China and Korea are greater than that of the US.
Does this indicate that these countries will eventually overtake the US in terms of the growth rate of
real GDP per capita? Explain.
Answer:
6. As we all know that pandemic COVID -19 is creating the threat for the economic meltdown. You
are required to analyze this pandemic effects on the aggregate demand and aggregate supply of
Canadian economy.
Answer
7. If consumers save a larger portion of their income, what effect would this have on the output,
employment, and price level in the short run and long run?
Answer:
8. The AD-AS model shows a snapshot of the economy at a given point in time. Both economic growth
and inflation are dynamic phenomena. Suppose economic growth is 4%o per year and aggregate
demand is growing at the same rate. What does the AD/AS model say the inflation rate should be?

Expert Solution

Step 1

The covid 19 is a pandemic which spread like a wildfire in the world economy. Even though the viral disease started in China, it spread to other countries like a wild wind. The US economy, European countries, central Asian countries etc are very much affected by the Covid 19 pandemic. The pandemic had caused many economical issues along with the health of the people.

Step 2

The covid 19 created a demand side shock to the economy. As people were in panic of the fast paced spread of the disease, they started to demand more goods and services in the economy to stock for their future needs. People expected the quarantine period and started to stock the goods and commodities that are needed to meet the quarantine period. This created the demand shock in the economy. The fear of people about the disease caused the production to shrink in the economy which leads to the supply side shocks in the economy. the supply curve shifts to the left whereas the demand curve shifts to the right.

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