Homework Answers
Answer
Option A
It is the level of real GDP in the long run
The long urn GDP is the full employment GDP as the full-employment GDP is the GDP produced using all the available resources at optimum level so it is also called potential GDP and that is depicted by the vertical aggregate supply curve.
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What is potential GDP? O A) It is the level of real GDP in the long...
Suppose the current level of real GDP for an economy is below its potential level of...
Suppose the current level of real GDP for an economy is below its potential level of RGDP. Starting with this situation, and in the absence of any government action, what should next happen in the AD-AS model? Group of answer choices A. A decrease in the Long-Run Aggregate Supply B. An increase in Aggregate Demand C. A decrease in Aggregate Demand D. An increase in the Short-Run Aggregate Supply E. An increase in the Long-Run Aggregate Supply F. A decrease...
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
Suppose the current level of real GDP for an economy is below its potential level of...
Suppose the current level of real GDP for an economy is below its potential level of RGDP. Starting with this situation, and in the absence of any government action, what should next happen in the AD-AS model? Group of answer choices A. A decrease in the Long-Run Aggregate Supply B. An increase in Aggregate Demand C. A decrease in Aggregate Demand D. An increase in the Short-Run Aggregate Supply E. An increase in the Long-Run Aggregate Supply F. A decrease...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
Potential real GDP is O A. the level of GDP attained when most firms are producing...
Potential real GDP is O A. the level of GDP attained when most firms are producing at capacity and unemployment is low. OB. the level of GDP attained when only some firms have excess capacity. O C. the level of GDP attained when all firms are producing at capacity. OD. the level of GDP attained when all firms have excess capacity Potential real GDP
Potential GDP is the level of aggregate output: O that can be sustained in the long...
Potential GDP is the level of aggregate output: O that can be sustained in the long run without inflation. O that can be sustained in the long run, if the capacity utilization is below 100%. O that can be produced at an overall zero unemployment rate. o that can be produced if structural unemployment is zero.
Concept: Actual/Potential GDP Potential GDP O A. falls below actual real GDP in recessions. O B....
Concept: Actual/Potential GDP Potential GDP O A. falls below actual real GDP in recessions. O B. is the value of final goods and services evaluated at base-year prices. O C. is the maximum output firms are capable of producing. O D. is the level of real GDP attained when all firms are producing at capacity.
COMICS) Figure 17-6 Potential GDP Price Level mt Real GDP (a) 74 5,5 6 7 8...
COMICS) Figure 17-6 Potential GDP Price Level mt Real GDP (a) 74 5,5 6 7 8 Unemployment Rate (percent) (b) Figure 17-6(b) illustrates that a. All of the above are correct. O1 b. the Phillips curve connecting points g. c, and r is not a menu of policy choices OTO c. in the short run, it is possible to "ride the Phillips curve" down toward lower rates of inflation. O d. in the short run, it is possible to "ride...
For each of the cases below, indicate whether the price level and level of real GDP...
For each of the cases below, indicate whether the price level and level of real GDP will go "up","down", or stay the same." Assume that prices are flexible in both directions unless the information given indicates otherwise. The term in parentheses indicates whether the economy is operating in the immediate short run, short run, or long run. Answers may be used more than once. Expansionary fiscal policy. (long run) A. Price level down; real GDP same Development of alternative energy...
3. Consider an economy where current real GDP is equal to its potential level y'. (a)...
3. Consider an economy where current real GDP is equal to its potential level y'. (a) Suppose that as a result of uncertainty over the future of trade relations between Canada and China, investment by firms in Canada falls. Use an AD-AS diagram to illustrate the effect of this drop in investment in the Canadian economy. (b) In response to negative economic conditions created in part (a), households decide to increase their savings because they fear they may soon lose...
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
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
Potential real GDP is O A. the level of GDP attained when most firms are producing at capacity and unemployment is low. OB. the level of GDP attained when only some firms have excess capacity. O C. the level of GDP attained when all firms are producing at capacity. OD. the level of GDP attained when all firms have excess capacity Potential real GDP
Potential GDP is the level of aggregate output: O that can be sustained in the long run without inflation. O that can be sustained in the long run, if the capacity utilization is below 100%. O that can be produced at an overall zero unemployment rate. o that can be produced if structural unemployment is zero.
Concept: Actual/Potential GDP Potential GDP O A. falls below actual real GDP in recessions. O B. is the value of final goods and services evaluated at base-year prices. O C. is the maximum output firms are capable of producing. O D. is the level of real GDP attained when all firms are producing at capacity.
COMICS) Figure 17-6 Potential GDP Price Level mt Real GDP (a) 74 5,5 6 7 8 Unemployment Rate (percent) (b) Figure 17-6(b) illustrates that a. All of the above are correct. O1 b. the Phillips curve connecting points g. c, and r is not a menu of policy choices OTO c. in the short run, it is possible to "ride the Phillips curve" down toward lower rates of inflation. O d. in the short run, it is possible to "ride...
For each of the cases below, indicate whether the price level and level of real GDP will go "up","down", or stay the same." Assume that prices are flexible in both directions unless the information given indicates otherwise. The term in parentheses indicates whether the economy is operating in the immediate short run, short run, or long run. Answers may be used more than once. Expansionary fiscal policy. (long run) A. Price level down; real GDP same Development of alternative energy...
3. Consider an economy where current real GDP is equal to its potential level y'. (a) Suppose that as a result of uncertainty over the future of trade relations between Canada and China, investment by firms in Canada falls. Use an AD-AS diagram to illustrate the effect of this drop in investment in the Canadian economy. (b) In response to negative economic conditions created in part (a), households decide to increase their savings because they fear they may soon lose...
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