Question
In: Economics
8. Beginning at a full employment equilibrium, a decrease in aggregate demand in the short run...
8. Beginning at a full employment equilibrium, a decrease in aggregate demand in the short run will tend to cause a:
| D. Higher price level and a lower employment level. |
| B. Lower price level and a lower employment level. |
| A. Lower price level and a higher employment level. |
|
C. Higher price level and a higher employment level. 9. Which of the following results if the aggregate quantity supplied exceeds the aggregate quantity demanded?
|
Solutions
Expert Solution
8. Beginning at a full employment equilibrium, a decrease in
aggregate demand in the short run will tend to cause a:
B. Lower price level and a lower employment level.
Explanation: The aggregate demand will shift to the left. Leading
to lower price level and output level.
9. Which of the following results if the aggregate quantity
supplied exceeds the aggregate quantity demanded?
D. A surplus causes the price level to fall.
Explanation: There exists situation of surplus when quantity
supplied is greater than quantity demanded.
Rahul Sunny answered 1 year agoRelated Solutions
Aggregate Demand and Aggregate Supply: Assume that the economy is in short run equilibrium, and experiencing...
Aggregate Demand and Aggregate Supply: Assume that the economy
is in short run equilibrium, and experiencing a
recession
Build the Aggregate Demand/Aggregate Supply graph which
corresponds to this situation. Remember to label everything (all
curves and axis and equilibrium) and include the long-run potential
curve.
Suppose The Fed were to make an open-market purchase of $200
million in US Treasury bonds. Is this a shift or a movement along a
curve? Which curve? Graph it in such a way that...
Let’s say the AD/AS equilibrium is at full employment, and then the aggregate demand curve moves...
Let’s say the AD/AS equilibrium is at full employment, and then
the aggregate demand curve moves to the left: (all answers “up” or
“down”; and assume prices are not sticky)
What happens to the amount of U.S. imports and exports when
prices in the U.S. go up.
List and explain two of the reasons that investment spending is
so much more volatile than consumption spending.
Let’s say the AD/AS equilibrium is at full employment, and then
the aggregate demand curve...
Assume an economy operating at Full Employment (on the Long Run Aggregate Supply Curve).Using Aggregate Demand...
Assume an economy operating at Full Employment (on the Long Run
Aggregate Supply Curve).Using Aggregate Demand and Short-Run
Aggregate Supply in each of the following cases state: i) the
direction AD would shift, ii) the change in the price level; iii)
The change in GDP, iv) whether the economy would end up in a
contractionary gap or expansionary gap.
a) There is a decrease in interest rates
b) The is a decline in the value of Household Wealth
c) There...
equilibrium levels; full employment levels of aggregate; Y=1250  
equilibrium
levels;
full employment levels of aggregate;
Y=1250
C= 1380
C=1100
S=220
S=150
AE=1530
1) Calculate the value of the recessionary gap (in 3 different
way)
2) Draw the Keynesian Income Expenditure diagram showing all the
equilibrium and full employment values, as well as
three distinct areas displaying the recessionary gap.
3) Outline three fiscal policies to close the recessionary gap.
could you please show all
your work, and indicate the impact of each policy on the government
budget Econ
Some analysts use the short-run and long-run effects on the aggregate demand-aggregate supply model to argue that expansionary monetary policy can't affect employment in the long run because in the short run
Some analysts use the short-run and long-run effects on the aggregate demand-aggregate supply model to argue that expansionary monetary policy can't affect employment in the long run because in the short run, monetary policy shifts the aggregate: demand curve to the left, but over time the increase in prices shifts aggregate supply to the right so that GDP will end up going back to its same level of output with a higher price level. supply curve to the left, but over time...
Unlike aggregate demand, we distinguish between short-run and long-run aggregate supply. Short-run aggregate supply (SRAS) is...
Unlike aggregate demand, we distinguish between short-run and
long-run aggregate supply. Short-run aggregate supply (SRAS) is a
horizontal curve whereas long-run aggregate supply (LRAS) is
vertical.
a.) In our model of aggregate supply and demand, we distinguish
between short-run and long-run aggregate supply. In the short run,
what variable can firms adjust and what variable is fixed? In the
long run?
b.) Plot the short-run aggregate supply curve, the long-run
aggregate supply curve, and the aggregate demand curve below. Label...
Aggregate Demand and Aggregate Supply Assume Broncoland has the following aggregate demand (AD) and short-run aggregate...
Aggregate Demand and Aggregate Supply Assume Broncoland has the
following aggregate demand (AD) and short-run aggregate supply
(SRAS) schedules.
Price Level
Aggregate Demand
Short-Run Aggregate Supply
120
8250
9700
115
8300
9750
110
8400
9700
105
8500
9600
100
8600
9500
95
8700
9300
90
8800
8800
85
8900
8000
80
9100
7000
Return to the original values of aggregate demand and short-run
aggregate supply. Assume the long-run full-employment level of
output (often called either potential GDP or the natural...
An increase in taxes when the economy is above full employment ______ aggregate demand and...
An increase in taxes when the economy is above full
employment ______ aggregate demand and real GDP, and the price
level ______.
A.
does not change; does not change
B.
decreases; falls
C.
increases; falls
D.
increases; rises
The magnitude of the tax multiplier is equal to
_______.
A.
the government expenditure multiplier divided by
MPC
B.
MPC times the government expenditure
multiplier
C.
the government expenditure multiplier
D.
MPC
Draw a diagram with an aggregate demand curve, a short-run aggregate supply curve, and a long-run...
Draw a diagram with an aggregate demand curve, a short-run
aggregate supply curve, and a long-run aggregate supply curve, for
an economy facing a recessionary gap. a) If the government does not
intervene to close this gap, describe what will happen to this
economy over time. Illustrate with a diagram. b) Describe the
policies that the government could use to return the economy to
long-run macroeconomic equilibrium, when it is facing a
recessionary gap. Illustrate with a diagram. c) What...
Draw a diagram with an aggregate demand curve, a short-run aggregate supply curve, and a long-run...
Draw a diagram with an aggregate demand curve, a short-run
aggregate supply curve, and a long-run aggregate supply curve, for
an economy facing a recessionary gap. a) If the government does not
intervene to close this gap, describe what will happen to this
economy over time. Illustrate with a diagram. b) Describe the
policies that the government could use to return the economy to
long-run macroeconomic equilibrium, when it is facing a
recessionary gap. Illustrate with a diagram. c) What...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Please give me an example of how we import stock data in jupyter notebook(Python) and analyze...
- Federal Scanline, Inc. uses a scanner on a conveyor line which scans 1,000 packages per hour....
- What are some of the unique challenges that survivors of military sexual assault face?
- Report Writing Select any publicly listed Saudi Company that operates in GCC, and write a (minimum...
- Explain and include your own example of the difference between teleological and deontological perspectives Explain the...
- Each day, you observe numerous practices in your office that are not "environmentally friendly" and that...
- Discuss the relevance of cultural and advocacy competency for school-based group leaders (pp. 122 -123). What...
ADVERTISEMENT