The long-run aggregate supply line will necessarily shift to the right when Group of answer choices 1. Consumers spend more on goods and services 2. Government spending increases 3. There is an advancement in technology and therefore potential output
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- Which of the following both shift the aggregate demand curve to the right? Group of answer choices net exports rise for some reason other than a price change and the money supply rises. net exports fall for some reason other than a price change and the money supply rises. net exports rise for some reason other than a price change and the price level rises. net exports fall for some reason other than a price change and the price level rises.Aggregate supply (AS) changes with each of the following except: Fiscal policy and monetary policy Potential GDP changes The money wage rate changes The money prices of other resources changeIn order to break stagflation, the government has to increase expenditure on food subsidies in the form of food vouchers, unemployment benefits or allowances, wages subsidy to increase household consumption expenditure and boost up the AD. With increased consumption expenditure, aggregate demand will rise, which would send a signal to the aggregate supply (AS) to raise production. This will create a positive effect, which will bring the economy out of recession. Show this in a graph.
- An increase in government spending would affect GDP if ? the long-run aggregate supply is vertical the short-run aggregate supply is vertical the short-run aggregate supply is upward sloping the short-run aggregate supply is horizontalWhich of the following would cause the aggregate supply curve to increase... Group of answer choices The government has reduced its spending by more than 10% over the last 2 years Throughout the economy, workers are using better equipment and output per hour is rising. Consumers are more confident and spending more than before. Energy prices such as gas and electricity have increased rapidly throughout the country.The government spends $3 billion to buy police cars.Explain why aggregate demand might increase bymore or less than $3 billion.
- Which of the following scenarios would result in an increase in Aggregate Demand? Question 12 options: A decline in investor confidence causes investments to fall. Congress cuts military spending by 3%. Congress passes a new income tax cut. Europe refuses to import American produce.prepare a list of events that would shift the aggregate supply curve leftward or rightward.If both aggregate supply and aggregate demand simultaneously increase, a. the price level and equilibrium real GDP will both remain unchanged. b. the price level will increase, but equilibrium real GDP will decline. c. equilibrium real GDP will increase, but we cannot predict what will happen to the price level. d. the price level will increase, but we cannot predict what will happen to equilibrium real GDP. e. the price level and equilibrium real GDP will both decline.
- Construct an Aggregate Supply and Aggregate Demand model where AS and AD are in equilibrium at potential GDP at a price level of 110 and Real GDP of $13.0 trillion dollars. Be sure to label all parts of the graph. a. Graph the initial effects of a recession that causes AD to decrease and real GDP to fall $0.5 trillion. b. Explain what will happen in the long run if nothing is done. c. If the government wanted to intervene in the economy, explain the Fiscal Policy measures that can be used to bring real GDP back to potential.. Events that shift the Aggregate Demand curve includegovernment spending changestax changesall of theseconsumer incomeDuring the pandemic of 2020, stimulus checks were sent to qualifying individuals. Some people chose to save their money, rather than spend it. This led to A,B,C, OR D ONE ANSWER a a smaller rightward shift in the aggregate demand (AD) than expected. b a larger rightward shift in the aggregate demand (AD) than expected. c a desire to increase consumption. d a smaller leftward shift in the aggregate demand (AD) than expected.
