Use two diagrams to explain the effects of the determinants of aggregate demand on real GDP in a nation. ii. Suppose there is an expectation of a rapid general price increase in goods and services in Australia in January 2021. Examine the effects of the anticipated general rapid increase in price for goods and services.
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Use two diagrams to explain the effects of the determinants of aggregate
demand on real GDP in a nation.
ii. Suppose there is an expectation of a rapid general
and services in Australia in January 2021. Examine the effects of the
anticipated general rapid increase in price for goods and services.
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- Suppose the U.S. Congress passes significant immigration reform that makes it more difficult for foreigners to come to the United States to work. Use the AD/AS model to explain how this would affect the equilibrium level of GDP and the puce level.Use two diagrams to explain the effects of the determinants of aggregatedemand on real GDP in a nation. (Over a given year, nominal GDP increased by about 2.5%. Over that year, the GDP deflator decreased by about 4%. From this information (and using our Aggregate Supply and Demand framework for analysis), we infer that over this year, Group of answer choices a) real GDP increased, and we had a decrease in Aggregate Demand. b) real GDP decreased, and we had a decrease in Aggregate Supply. c) real GDP increased, and we had an increase in Aggregate Demand. d) real GDP increased, and we had an increase in Aggregate Supply. e) real GDP decreased, and we had an increase in Aggregate Demand.
- Question 1 a) Give the definition of GDP and explain what items are not included in its calculation? b) How is GDP calculated using the expenditure approach? c) How is GDP calculated using the income approach? d) Explain the problem of "double-counting" and how it can be avoided in calculating GDP Question 2 Assume that an economy is initially operating at the natural rate of output (full employment output). Use the AD-AS model to illustrate graphically the effects on price and output of an increase in government spending and a decrease in the cash rate. Explain your assumptions with respect to the range of aggregate supply of your analysis.Knowing that: The formula for economic impact is I(r)=(A)/1-r ---(i) The formula for impact change is ∆I= I'(r)*∆r ---(ii) The formula for percentage change in spending is g(r)=(r)/1-r ---(iii)The first basic piece in the aggregate expenditures model is: O the expenditure schedule. O the demand schedule. O the supply schedule. O the consumption schedule
- From the information below calculate aggregate demand; Consumption (C) = $200 + 0.6Y Investment (I) = $300 Government (G) = $100 Net Export (NX) = $50 Which one of the following statements about Consumption and Aggregate Demand is CORRECT when the economy achieves equilibrium GDP? a. One is 350 greater than the other b. One comprises the other c. They are valued at $1025 and $1375, respectively d. They are valued at $1375 and $1025, respectively e. They are both the sameA4 Imagine that in the year 2035, Japan’s economy shrinks significantly, causing a decrease in investment in the U.S. economy. Use the ADAS model to explain the likely short run impacts on U.S. GDP and the aggregate price level. What do you anticipate to happen to U.S. consumption expenditures and U.S. employment? Explain your reasoning for each of your predictions and show graphically as appropriate. Students may utilize Paint, Word (the shapes tool under Insert), OneNote (Draw tab), or hand draw the graphs.Give typing answer with explanation and conclusion to all parts In the United States, real GDP is currently calculated using A) a variable-weighting scheme. B) a chain-weighting scheme. C) a fixed-weighting scheme. D) an autoregressive scheme.
- The following is the macro model of the economy for next year. (i) Find theparametric solutions for the predicted GDP (Y ) and for the predicted netexport (X): (ii) Verify that the 3rd equation is satisÖed by your solutions. Y=C+G0+X C=a+b(Y-t0Y) X=k-mYWhy must double counting be avoided when measuring GDP? Provide an elaborate answer with at least one example. Part B: Aggregate Demand (AD) Curve shows the relationship between the economy’s price level and real GDP demanded. In other words, real GDP demanded by different groups of buyers, i.e., Consumers (C), Businesses (I), Government (G), and Net Amount by Foreigners (Export - Import), at different price levels give us points on a graph, which are connected to form a curve called AD curve. Review the textbook chapter, and conduct internet research to discuss determinants of AD or factors that shift AD curve. Part C: Following graph shows business cycle fluctuation in a hypothetical economy. "Y" denotes year, and "Q" denotes quarter. What do points A, B, C, and D denote? Write at least a sentence each about what these points denote. Also, explain what represent the curve segments: A to B, B to C, and C to D. Lastly, because economic activity fluctuates, how is long-term…Comment, on the likely outcome with sufficient arguments? a) Impact on GDP when, Interest rates have come down in the countryb) Impact on balance of payment, when there is a huge demand of vaccines produced in India in South Africa.c) Inflation rate in India reaches negative 2% (-2%)d) The aggregate demand falls short of aggregate supply in the economy