If real GDP is close to or at potential GDP then ________ and if real GDP...
If real GDP is close to or at potential GDP then ________ and if real GDP is not close to potential GDP then ________.
| a. | equilibrium occurs in the flat range of AS; equilibrium occurs in the steep range of AS |
| b. | equilibrium occurs in the steep range of AD; equilibrium occurs in the flat range of AD |
| c. | equilibrium occurs in the steep range of AS; equilibrium occurs in the flat range of AS |
Homework Answers
"C"
If real GDP is close to or at potential GDP then equilibrium occurs at steep range of AS and if real GDP is not close to potential GDP then equilibrium occurs in the flat range of AS.
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If real GDP is close to or at potential GDP then ________ and if
real GDP...
Alter 1 Hc What term is used to describe the maximum quantity that an economy can...
Alter 1 Hc What term is used to describe the maximum quantity that an economy can produce, in the context of its existing inputs, market and legal institutions? potential GDP aggregate supply GDP deflator If real GDP is not close to potential GDP then and if real GDP is close to or at potential GDP then equilibrium occurs in the steep range of AS: equilibrium occurs in the flat range of AS equilibrium occurs in the steep range of AD,...
The potential GDP line is a ________ on the Keynesian Cross diagram which indicates GDP at...
The potential GDP line is a ________ on the Keynesian Cross diagram which indicates GDP at its potential on the horizontal axis. vertical line horizontal line sloping upward line The pure Keynesian AD-AS model assumes that for any level of GDP below potential, any change in AD affects real GDP, but NOT the ________. price level output level spending level Suppose an economy is defined by the following: C = 136 + 0.9 (Yd). The (Yd) in this algebraic equation...
Consider an economy that begins with real GDP equal to potential GDP. There is then a...
Consider an economy that begins with real GDP equal to potential GDP. There is then a sudden increase in the prices of raw materials, which shifts the aggregate supply (AS)curve upward. a. Draw the initial long run equilibrium in an AD/AS diagram. b. Now show the immediate effect of the supply shock in your diagram. c. Suppose wages and prices in this economy adjust instantly to shocks. Explain what happens to unemployment in this economy. d. If wages and prices...
Question 20 1 pts In the long run, real GDP will be close to or at...
Question 20 1 pts In the long run, real GDP will be close to or at its potential GDP. be close to or the consumer price index. be close to or on the horizontal part of the AS curve. Question 17 1 pts In the long run, real GDP will be close to or on the vertical part of the AS curve. be close to or on the horizontal part of the AS curve. be close to or the consumer...
FEE If real GDP is greater than potential GDP, the economy is O A. in a...
FEE If real GDP is greater than potential GDP, the economy is O A. in a below full - employment equilibrium. OB. in a long-run equilibrium. O C. not in a short - run macroeconomic equilibrium. OD. in a recessionary equilibrium. O E. in an above full - employment equilibrium. 7:30
Figure 20-4 AS AD AD AD Real GDP Real GDP (2) Real GDP (3) Real GDP...
Figure 20-4 AS AD AD AD Real GDP Real GDP (2) Real GDP (3) Real GDP (1) 4) Which of the situations illustrated in Figure 20-4 shows a currency appreciation leading to disinflation? a. 3 b. 1 c.2 O d. 4
Suppose that real GDP is currently $13.88 trillion and potential real GDP is $14.0 trillion, or...
Suppose that real GDP is currently $13.88 trillion and potential real GDP is $14.0 trillion, or a gap of $1,000 billion. The government purchases multiplier is 3.3, and the tax multiplier is 2.3. Holding other factors constant, by how much will government purchases need to be increased to bring the economy to equilibrium at potential GDP? Government spending will need to be increased by $___ billion. (Enter your response rounded to the nearest whole number.) Holding other factors constant, by...
help with part c please!!! Suppose that real GDP is currently 51.47 trillion potential GDP is...
help with part c please!!!
Suppose that real GDP is currently 51.47 trillion potential GDP is $1.53 trillion, the government purchases multiplier is 2, and the tax multiplier is -15 a. Holding other factors constant, government purchases will need to be increased by $ 0.03 trillion to bring the economy to equilibrium at potential GDP (Round fo four decimal places as needed.) b. Holding other factors constant, taxes have to be cut by $ 0.04 trillion to bring the economy...
Choose which statement is most correct. A) Real GDP can never exceed potential GDP. B) Real...
Choose which statement is most correct. A) Real GDP can never exceed potential GDP. B) Real GDP must always equal potential GDP. C) At times, real GDP can exceed potential GDP. D) Nominal GDP can never exceed potential GDP. E) Nominal GDP must always equal potential GDP.
Assume that equilibrium real GDP is $ 800 billion, potential real GDP is $ 950 billion,...
Assume that equilibrium real GDP is $ 800 billion, potential real GDP is $ 950 billion, the MPC is .80, and the MPI is .40. a. How much taxes fall to eliminate the GDP gap? b.If government spending and taxes both change by the same amount, how much must they change to eliminate the recessionary gap?
Alter 1 Hc What term is used to describe the maximum quantity that an economy can produce, in the context of its existing inputs, market and legal institutions? potential GDP aggregate supply GDP deflator If real GDP is not close to potential GDP then and if real GDP is close to or at potential GDP then equilibrium occurs in the steep range of AS: equilibrium occurs in the flat range of AS equilibrium occurs in the steep range of AD,...
Question 20 1 pts In the long run, real GDP will be close to or at its potential GDP. be close to or the consumer price index. be close to or on the horizontal part of the AS curve. Question 17 1 pts In the long run, real GDP will be close to or on the vertical part of the AS curve. be close to or on the horizontal part of the AS curve. be close to or the consumer...
FEE If real GDP is greater than potential GDP, the economy is O A. in a below full - employment equilibrium. OB. in a long-run equilibrium. O C. not in a short - run macroeconomic equilibrium. OD. in a recessionary equilibrium. O E. in an above full - employment equilibrium. 7:30
Figure 20-4 AS AD AD AD Real GDP Real GDP (2) Real GDP (3) Real GDP (1) 4) Which of the situations illustrated in Figure 20-4 shows a currency appreciation leading to disinflation? a. 3 b. 1 c.2 O d. 4
help with part c please!!!
Suppose that real GDP is currently 51.47 trillion potential GDP is $1.53 trillion, the government purchases multiplier is 2, and the tax multiplier is -15 a. Holding other factors constant, government purchases will need to be increased by $ 0.03 trillion to bring the economy to equilibrium at potential GDP (Round fo four decimal places as needed.) b. Holding other factors constant, taxes have to be cut by $ 0.04 trillion to bring the economy...
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