EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 36, Problem 5RQ
To determine
Impact of the given situations in the short run and the long run.
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Students have asked these similar questions
3. Suppose the price level and value of the
dollar in year 1 are 1 and $1,
respectively. If the price level rises to
1.25 in year 2, what is the new value of
the dollar? If, instead, the price level
falls to 0.50, what is the value of the
U.S.
dollar? LO14.3
What is the likely result from a depreciation of a nation's currency when its economy is already operating at its full-employment level of output?
O A. Net exports would fall and contribute to demand-pull inflation.
O B. Net exports would fall, but equilibrium GDP would rise.
O C. Net exports would rise and contribute to demand-pull inflation.
O D. Net exports would rise, but equilibrium GDP would fall.
A Moving to another question will save this response.
Question 3
What is the likely result from a depreciation of a nation's currency when its economy is already operating at its full-employment level of output?
O A. Net exports would rise and contribute to demand-pull inflation.
O B. Net exports would fall and contribute to demand-pull inflation.
O C. Net exports would rise, but equilibrium GDP would fall.
O D. Net exports would fall, but equilibrium GDP would rise.
A Moving to another question will save this response.
SHA
Chapter 36 Solutions
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- Assume that in response to the Corona crisis, Portugal experiences a decrease in output of 1% and it is associated with a rise in the unemployment rate of 2 percentage points. What is the Okun's coefficient? O a. 0.4 O b. -2.0 Oc. -0.4 O d. 2.0 Which statement is true: When the short term interest rate in the Euro area is at zero percent, O a. the ECB, according to its mandate, cannot further reduce the policy rate O b. the ECB can stimulate the economy by lending directly to the government. the ECB can buy assets to reduce long term interest rates. O d. the ECB can steepen the Phillips curve by reducing the bargaining gap. Markup, nitial euilbrium markup Profit-maximizirg mark-up 210 Number of firms, a Equilibrium number of firms Figure: Equilibrium mark-ups () and the number of firms in the market (n) Consider the situation in the figure. Assume that there are no barriers to market entry, no subsidies, and the current mark-up a is lower than the initial equilibrium mark-up in A.…arrow_forwardA Moving to another question will save this response. Quèstion 16 What is the likely result from a depreciation of a nation's currency when its economy is already operating at its full-employment level of output? O A. Net exports would rise, but equilibrium GDP would fall. O B. Net exports would fall and contribute to demand-pull inflation. OC. Net exports would fall, but equilibrium GDP would rise. O D. Net exports would rise and contribute to demand-pull inflation. hp *****arrow_forwardA candidate for political office announces the following policies which, she says, economics clearly demonstrates will lead to higher output in the long run: 1. increase immigration from abroad 2. make trade more open between the US and other countries. Select one: O a1 shifts long-run aggregate supply right, 2 shifts long-run aggregate supply left. O b. 1 and 2 both shift long-rum aggregate supply right. O c. 1 shifts long-run aggregate supply left, 2 shifts long-run aggregate supply right. O d. 1 and 2 both shift long-run aggregate supply left.arrow_forward
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