Q.1 (B2. Shift of aggregate demand) For each of the following separate scenarios, discuss how it would affect AD, SRAS and LRAS. Stock prices keep rising. More tourists come to Seattle The number of workers increases. Firms expect price level to fall. Government spends more money on military Q.2 (D1. Equilibrium in the Aggregate demand-aggregate supply model) For each of the following separate scenarios, discuss what happens in short run and then long run. There is a severe drought reducing the farm yield. Consumers are more confident about the economy. There are more workers in the labor force. Due to stock market crash, the wealth of households drops The government depreciates its currency. Q.3 (D1. Equilibrium in the Aggregate demand-aggregate supply model) Suppose an event happens and the price level and real GDP change as shown in the following table: Before the event Short run Long run Real GDP (USD) 3.5 trillion 3.8 trillion 3.5 trillion Price level 100 120 140 Discuss what happened that cause the above changes.
Q.1 (B2. Shift of aggregate demand) For each of the following separate scenarios, discuss how it would affect AD, SRAS and LRAS. Stock prices keep rising. More tourists come to Seattle The number of workers increases. Firms expect price level to fall. Government spends more money on military Q.2 (D1. Equilibrium in the Aggregate demand-aggregate supply model) For each of the following separate scenarios, discuss what happens in short run and then long run. There is a severe drought reducing the farm yield. Consumers are more confident about the economy. There are more workers in the labor force. Due to stock market crash, the wealth of households drops The government depreciates its currency. Q.3 (D1. Equilibrium in the Aggregate demand-aggregate supply model) Suppose an event happens and the price level and real GDP change as shown in the following table: Before the event Short run Long run Real GDP (USD) 3.5 trillion 3.8 trillion 3.5 trillion Price level 100 120 140 Discuss what happened that cause the above changes.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Q.1 (B2. Shift of aggregate
- Stock prices keep rising.
- More tourists come to Seattle
- The number of workers increases.
- Firms expect price level to fall.
- Government spends more money on military
Q.2 (D1. Equilibrium in the Aggregate demand-
For each of the following separate scenarios, discuss what happens in short run and then long run.
- There is a severe drought reducing the farm yield.
- Consumers are more confident about the economy.
- There are more workers in the labor force.
- Due to stock market crash, the wealth of households drops
- The government
depreciates its currency.
Q.3 (D1. Equilibrium in the Aggregate demand-aggregate supply model)
Suppose an event happens and the price level and real
|
Before the event |
Short run |
Long run |
|
|
Real GDP (USD) |
3.5 trillion |
3.8 trillion |
3.5 trillion |
|
Price level |
100 |
120 |
140 |
Discuss what happened that cause the above changes.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education