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Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run, the increase in money growth will change which of the following? Check all that apply. □ The quantity of physical capital The level of technological knowledge The inflation rate The price level Suppose the economy produces real GDP of $60 billion when unemployment is at its natural rate. Use the purple points (diamond symbol) to plot the economy's long-run aggregate supply (LRAS) curve on the graph. (?) 132 PRICE LEVEL 128 132 128 124 120 116 112 108 104 100 0 10 20 40 50 60 30 OUTPUT (Billions of dollars) 70 80 RAS

Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run, the increase in money growth will change which of the following? Check all that apply. □ The quantity of physical capital The level of technological knowledge The inflation rate The price level Suppose the economy produces real GDP of $60 billion when unemployment is at its natural rate. Use the purple points (diamond symbol) to plot the economy's long-run aggregate supply (LRAS) curve on the graph. (?) 132 PRICE LEVEL 128 132 128 124 120 116 112 108 104 100 0 10 20 40 50 60 30 OUTPUT (Billions of dollars) 70 80 RAS

Brief Principles of Macroeconomics (MindTap Course List)
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter15: Aggregate Demand And Aggregate Supply
Section: Chapter Questions
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Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run, the increase in money growth will change which of the following? Check all that apply. O The quantity of physical capital The level of technological knowledge The inflation rate O The price level Suppose the economy produces real GDP of $60 billion when unemployment is at its natural rate. Use the purple points (diamond symbol) to plot the economy's long-run aggregate supply (LRAS) curve on the graph. (?) 132 CA PRICE LEVEL 128 132 128 124 120 116 112 108 104 100 F 0 10 20 30 40 50 60 OUTPUT (Billions of dollars) 70 80 RAS
Transcribed Image Text:Suppose the Fed doubles the growth rate of the quantity of money in the economy. In the long run, the increase in money growth will change which of the following? Check all that apply. O The quantity of physical capital The level of technological knowledge The inflation rate O The price level Suppose the economy produces real GDP of $60 billion when unemployment is at its natural rate. Use the purple points (diamond symbol) to plot the economy's long-run aggregate supply (LRAS) curve on the graph. (?) 132 CA PRICE LEVEL 128 132 128 124 120 116 112 108 104 100 F 0 10 20 30 40 50 60 OUTPUT (Billions of dollars) 70 80 RAS
Suppose the government passes a law that significantly increases the minimum wage. The policy will cause the natural rate of unemployment to which will: O Shift the long-run aggregate supply curve to the right O Shift the long-run aggregate supply curve to the left O Not affect the long-run aggregate supply curve In the following table, determine how each event affects the position of the long-run aggregate supply (LRAS) curve. Direction of LRAS Curve Shift The government allows more immigration of working-age adults who find work. For environmental and safety reasons, the government requires that the country's nuclear power plants be permanently shut down. An investment tax credit increases the rate at which firms acquire machinery and equipment.
Transcribed Image Text:Suppose the government passes a law that significantly increases the minimum wage. The policy will cause the natural rate of unemployment to which will: O Shift the long-run aggregate supply curve to the right O Shift the long-run aggregate supply curve to the left O Not affect the long-run aggregate supply curve In the following table, determine how each event affects the position of the long-run aggregate supply (LRAS) curve. Direction of LRAS Curve Shift The government allows more immigration of working-age adults who find work. For environmental and safety reasons, the government requires that the country's nuclear power plants be permanently shut down. An investment tax credit increases the rate at which firms acquire machinery and equipment.
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