Homework Answers
Decrease in dollar increases exports and decreases imports, increasing net exports and aggregate demand. So:
3. Aggregate demand is affected
1. Increase in aggregate demand
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Question 15 (2 points) What will be the effect of a decrease in the value of...
Question 1 An increase in the price level will ________ the real value of wealth and,...
Question 1 An increase in the price level will ________ the real value of wealth and, as a result, there will be ________ the aggregate demand curve. have no effect on; no change in increase; a rightward shift of reduce; an upward movement along reduce; a leftward shift of increase; an upward movement along 2. A severe drought hits a country and reduces farm output by 50 percent. This will impact aggregate demand. short-run aggregate supply and aggregate demand. short-run...
2. Explain whether each of the following events will increase, decrease, or have no effect on...
2. Explain whether each of the following events will increase, decrease, or have no effect on long-run aggregate supply. Draw the graph and show your work. (a) The United State experiences a wave of immigration. (b) Congress raises the minimum wage to $15 per hour. (c) Intel invents a new and more powerful computer chip (d) A severe hurricane damages factories along the East Coast 3. Draw a diagram with aggregate demand, short-run aggregate supply, and long-run aggregate supply. Be...
Suppose government spending decreases. Beginning in a long-run equilibrium, what would be the long-run effect on...
Suppose government spending decreases. Beginning in a long-run equilibrium, what would be the long-run effect on the goods and services market? Group of answer choices A. GDP Deflator increases, Real GDP decreases B. GDP Deflator decreases, Real GDP decreases C. GDP Deflator decreases, no change in Real GDP D. GDP Deflator increases, no change in Real GDP An increase in the amount of technology will shift which curve(s)? Group of answer choices A. Aggregate demand and short-run aggregate supply B....
Please help with both questions The short-run aggregate supply curve is horizontal when Othere are unemployed...
Please help with both questions
The short-run aggregate supply curve is horizontal when Othere are unemployed resources and prices do not increase when aggregate demand increases. there are no unemployed resources and prices do not increase when aggregate demand or supply increases. prices are inflexible and the economy is at full employment. Othere are unemployed resources and prices do not decrease when aggregate supply increases. 0.5 points Save Answer QUESTION 6 A reduction in nominal wages will cause which of...
Question 2.4. (20 points) Over the last few units of this class, we've discussed how most...
Question 2.4. (20 points) Over the last few units of this class, we've discussed how most economists agree that monetary neutrality holds in the long run but not in the short run. Let's explore this concept. (a) (5 points) Draw a graph of an economy in its long-run equilibrium. You should be sure to include both the long-run and short-run aggregate supply curves as well as the short-run aggregate demand curve. Label the long-run equilibrium price level and the level...
4. In the short-run, a decrease in the GDP deflator will a) Decrease aggregate quantity supplied...
4. In the short-run, a decrease in the GDP deflator will a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 5. In the long-run, a decrease in the GDP deflator will: a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 6. A decrease in the GDP deflator will: a) Increase aggregate quantity supplied b) Have no effect on aggregate quantity...
4. In the short-run, a decrease in the GDP deflator will a) Decrease aggregate quantity supplied b) Have no effec...
4. In the short-run, a decrease in the GDP deflator will a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 5. In the long-run, a decrease in the GDP deflator will: a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 6. A decrease in the GDP deflator will: a) Increase aggregate quantity supplied b) Have no effect on aggregate quantity...
6. Demonstrate the decrease in wealth using the closed AD-AS model, ceteris paribus, in both the...
6. Demonstrate the decrease in wealth using the closed AD-AS model, ceteris paribus, in both the short-run and long-run. Assumptions: (1) start in long-run equilibrium; (2) prices are sticky; (3) nominal wages are fixed in the short-run. [Note: this is the self-correcting version.] [Sub-questions 6-10 are connected.] In the short-run, _______ shifts _______. A. the aggregate demand curve; leftward B. the aggregate demand curve; rightward C. the short-run aggregate supply curve; leftward D. the short-run aggregate supply curve; rightward E....
QUICK CHECK multiple choice 1. When the economy goes into a recession, real GDP —and unemployment a. rises, rises b...
QUICK CHECK multiple choice 1. When the economy goes into a recession, real GDP —and unemployment a. rises, rises b. rises, falls c. falls, rises d. falls, falls 2. Which of the following is shifted by a sudden crash in the stock market? a. the aggregate-demand curve b. the short-run aggregate-supply curve, but not the long-run aggregate-supply curve c. the long-run aggregate-supply curve, but not the short-run aggregate-supply curve d. both the short-run and the long-run aggregate- supply curves PART...
Inter est rate (percent) S1 S2 r1 Di Quantity of money per period What happens in...
Inter est rate (percent) S1 S2 r1 Di Quantity of money per period What happens in the aggregate economy (ADAS model) as a result of the increase in money supply and reduction in interest rates? The aggregate demand curve shifts to the left. The aggregate demand curve shifts to the right. The short-run aggregate supply curve shifts to the right. The short-run aggregate supply curve shifts to the left.
2. Explain whether each of the following events will increase, decrease, or have no effect on long-run aggregate supply. Draw the graph and show your work. (a) The United State experiences a wave of immigration. (b) Congress raises the minimum wage to $15 per hour. (c) Intel invents a new and more powerful computer chip (d) A severe hurricane damages factories along the East Coast 3. Draw a diagram with aggregate demand, short-run aggregate supply, and long-run aggregate supply. Be...
Please help with both questions
The short-run aggregate supply curve is horizontal when Othere are unemployed resources and prices do not increase when aggregate demand increases. there are no unemployed resources and prices do not increase when aggregate demand or supply increases. prices are inflexible and the economy is at full employment. Othere are unemployed resources and prices do not decrease when aggregate supply increases. 0.5 points Save Answer QUESTION 6 A reduction in nominal wages will cause which of...
Question 2.4. (20 points) Over the last few units of this class, we've discussed how most economists agree that monetary neutrality holds in the long run but not in the short run. Let's explore this concept. (a) (5 points) Draw a graph of an economy in its long-run equilibrium. You should be sure to include both the long-run and short-run aggregate supply curves as well as the short-run aggregate demand curve. Label the long-run equilibrium price level and the level...
4. In the short-run, a decrease in the GDP deflator will a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 5. In the long-run, a decrease in the GDP deflator will: a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 6. A decrease in the GDP deflator will: a) Increase aggregate quantity supplied b) Have no effect on aggregate quantity...
4. In the short-run, a decrease in the GDP deflator will a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 5. In the long-run, a decrease in the GDP deflator will: a) Decrease aggregate quantity supplied b) Have no effect on aggregate quantity supplied c) Decrease the aggregate quantity demanded 6. A decrease in the GDP deflator will: a) Increase aggregate quantity supplied b) Have no effect on aggregate quantity...
QUICK CHECK multiple choice 1. When the economy goes into a recession, real GDP —and unemployment a. rises, rises b. rises, falls c. falls, rises d. falls, falls 2. Which of the following is shifted by a sudden crash in the stock market? a. the aggregate-demand curve b. the short-run aggregate-supply curve, but not the long-run aggregate-supply curve c. the long-run aggregate-supply curve, but not the short-run aggregate-supply curve d. both the short-run and the long-run aggregate- supply curves PART...
Inter est rate (percent) S1 S2 r1 Di Quantity of money per period What happens in the aggregate economy (ADAS model) as a result of the increase in money supply and reduction in interest rates? The aggregate demand curve shifts to the left. The aggregate demand curve shifts to the right. The short-run aggregate supply curve shifts to the right. The short-run aggregate supply curve shifts to the left.
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