EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 30, Problem 4RQ
To determine
Aggregate supply curve .
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Aggregate D&S assignment chap 12....
Assignment Chapter 12
1. Suppose that the aggregate demand and aggregate supply
schedules for a hypothetical economy are as shown below: LO5
Amount of
Amount of
Real GDP
Real GDP
Demanded,
Billions
Price Level
Supplied,
Billions
(Price Index)
$100
300
$450
200
250
400
300
200
300
400
150
200
500
100
100
a. Use these sets of data to graph the aggregate demand and
aggregate supply curves. What is the equilibrium price level and the
equilibrium level of real output in this hypothetical economy? Is the
equilibrium real output also necessarily the full-employment real
output?
b. If the price level in this economy is 150, will quantity demanded
equal, exceed, or fall short of quantity supplied? By what amount? If
the price level is 250, will quantity demanded equal, exceed, or fall
short of quantity supplied? By what amount?
c. Suppose that buyers desire to purchase $200 billion of extra real
output at each price level. Sketch in the new…
5. Refer to the data in the table that
accompanies problem 2. Suppose that
the present equilibrium price level and
level of real GDP are 100 and $225, and
that data set B represents the relevant
aggregate supply schedule for the
economy. LO12.6
a. What must be the current amount of
real output demanded at the 100 price
level?
b. If the amount of output demanded
declined by $25 at the 100 price level
shown in B, what would be the new
equilibrium real GDP? In business
суcle
economists call this change in real
terminology,
what
would
GDP?
: Which of the following statements is true if there is an increase in aggregate demand while the economy is
in equilibrium on a positively sloping short-run aggregate supply curve?
3 -
O a) Prices rise, national income does not change
B) Prices decrease, national income does not change
O C) Prices go up and national income goes down.
O D) Prices decrease and national income decreases.
O TO) Prices rise, national income rises
Chapter 30 Solutions
EP ECONOMICS,AP EDITION-CONNECT ACCESS
Ch. 30.7 - Prob. 1QQCh. 30.7 - Prob. 2QQCh. 30.7 - Prob. 3QQCh. 30.7 - Prob. 4QQCh. 30.A - Prob. 1ADQCh. 30.A - Prob. 2ADQCh. 30.A - Prob. 1ARQCh. 30.A - Prob. 2ARQCh. 30.A - Prob. 1APCh. 30.A - Prob. 2AP
Ch. 30 - Prob. 1DQCh. 30 - Prob. 2DQCh. 30 - Prob. 3DQCh. 30 - Prob. 4DQCh. 30 - Prob. 5DQCh. 30 - Prob. 6DQCh. 30 - Prob. 7DQCh. 30 - Prob. 8DQCh. 30 - Prob. 9DQCh. 30 - Prob. 1RQCh. 30 - Prob. 2RQCh. 30 - Prob. 3RQCh. 30 - Prob. 4RQCh. 30 - Prob. 5RQCh. 30 - Prob. 6RQCh. 30 - Prob. 7RQCh. 30 - Prob. 8RQCh. 30 - Prob. 9RQCh. 30 - Prob. 1PCh. 30 - Prob. 2PCh. 30 - Prob. 3PCh. 30 - Prob. 4PCh. 30 - Prob. 5P
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Similar questions
- Suppose aggregate demand in the economy sharply decines. Keynesian economists say that the price level (at least for a time) will and real output wil O remain constant; decrease Increase; remain constant remain constant; increase decrease; remain constant lo000arrow_forwardSuppose that the table presented below shows an economy's relationship between real output and the inputs needed to produce that output: Input Quantity Real GDP 150.0 $ 400 112.5 300 75.0 200 Instructions: Enter your responses answers rounded to 2 decimal places. a. What is the level of productivity in this economy? b. What is the per-unit cost of production if the price of each input unit is $2? $ C. Assume that the input price increases from $2 to $3 with no accompanying change in productivity. What is the new per-unit cost of production? In what direction would the $1 increase in input price push the economy's aggregate supply curve? (Click to select) v What effect would this shift of aggregate supply have on the price level and the level of real output? O The price level would decrease and real output would increase. O Both the price level and real output would remain the same. O The price level would decrease and real output would remain the same. O The price level would increase…arrow_forwardd. A decrease in aggregate demand. e. An increase in aggregate demand that exceeds an increase in aggrega supply.arrow_forward
- Suppose the economy is in long-run equilibrium. Then because of the COVID pandemic, people become worried about their future income and retain that worry for some time. How is the new long-run equilibrium different from the original one? O a. the price level is the same and GDP is lower. O b. both price and real GDP are higher. O c. the price level is lower and real GDP is the same. O d. both price and real GDP are lower.arrow_forwarddemanded equal, exceed, or fall short of quantity supplied? llowing L012.4 c. Suppose that buyers desire to purchase $200 billion of extra real output at each price level. Sketch in the new aggregate By what amount? demand curve as AD,. What are the new equilibriumsate Real GDP level and level of real output? 4. Suppose that the table presented below shows an economy's relationship between real output and the inputs needed to pro- 225 225 duce that output: LO12.4 225 Real GDP 225 Input Quantity 150.0 $400 in the t run? 112.5 300 75.0 200 ut per a. What is productivity in this economy? b. What is the per-unit cost of production if the price of each input unit is $2? c. Assume that the input price increases from $2 to $3 with no accompanying change in productivity. What is the new per- unit cost of production? In what direction would the $1 increase in input price push the economy's aggregate supply curve? What effect would this shift of aggregate supply have on the price level and the…arrow_forwardThe figure below shows the short-run aggregate demand and supply curves of an economy. In this figure, the distance between Y1 and Y2 represents: Figure 10.2 Price level Potential output SRAS AD Real GDP a. a recessionary gap. b. the full employment output. O . the natural rate of unemployment. d. a cost-push inflation. e. an expansionary gap.arrow_forward
- e Page 426 13.1. What is the aggregate demand-aggregate supply model? Fill in the blanks to complete the following passage concerning the history of U.S. recessions. Since the year 1900, the United States has experienced recessions. Since 1970, recessions have occurred. 2 7 22 42 + LO 5 10arrow_forwardDemand-pull inflation is caused by an increase in aggregate demand to an equilibrium point below full employment. an increase in aggregate demand to an equilibrium point beyond full employment. a decrease in short-run aggregate supply to an equilibrium point below full employment. O a decrease in short-run aggregate supply to an equilibrium point beyond full employment. Cost-push inflation is caused by O a decrease in short-run aggregate supply to an equilibrium point beyond full employment. O a decrease in short-run aggregate supply to an equilibrium point below full employment. an increase in aggregate demand to an equilibrium point below full employment. an increase in aggregate demand to an equilibrium point beyond full employment.arrow_forwardAggregate demand is defined as O the relationship between the total quantity of goods and services demanded and the income level, all other determinants of spending unchanged. the relationship between the total quantity of goods and services demanded and the price level, all other determinants of spending unchanged. the demand for goods and services generated by all sectors in the economy, holding price level constant. O the relationship between the total quantity of goods and services demanded and the supply of factors of production, all other determinants of production unchanged.arrow_forward
- 8. Assume that (a) the price level is flexible upward but not downward and (b) the economy is currently operating at its full-employment output. Other things equal, how will each of the following affect the equilibrium price level and equilibrium level of real output in the short run? L012.6 a. An increase in aggregate demand. b. A decrease in aggregate supply, with no change in aggregate demand. c. Equal increases in aggregate demand and aggregate supply. d. A decrease in aggregate demand. e. An increase in aggregate demand that exceeds an increase in aggrega supply.arrow_forwardA price-level increase, Ceteris Paribus, will: Select one: O a. cause an upward movement along the aggregate demand curve. O b. cause a downward movement along the aggregate demand curve. O c. cause a rightward shift of the aggregate demand curve. O d. have no impact on the aggregate demand curve. O e. cause a leftward shift of the aggregate demand curve.arrow_forwardA decrease in the price of foreign oil will affect the U.S. economy by O a. decreasing aggregate supply. O b. increasing aggregate demand. O c. increasing aggregate supply. O d. decreasing aggregate demandarrow_forward
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