Here we take a simple calculation wherein we check the values.
Once the values are put in place, the below equation is formed. Solving the below equation, we getthe desired value.
Y=a-f-bm(πt- π)
=-3% - 2% - 1*0.5*(0%-2%)
= -5% - 0.5*-2%
=-4%
For the aggregate demand curve: Ỹ,-a-f.-bm ( t-T), when a -3%Л 2%, Б-1, m 3. 0.5,...
1. Aggregate demand curve of an economy is given by AD = 51 - 0.2P, the long-run aggregate supply, LRAS, is 30 and the short-run aggregate supply is given by SRAS = 0.3 P (all output measures are in US$ billions and the price level is given as an index number). What could be the unemployment rate if the natural rate of unemployment is 4%? 2. Aggregate demand curve of an economy is given by AD = 51 - 0.2P,...
1) List and explain the three reasons the aggregate-demand curve is downward sloping. 2) Explain why the long-run aggregate-supply curve is vertical. 3) What causes aggregate demand to shift to the left and what causes an aggregate demand to shift to the right? Give one example for each scenario. 4) Explain why economic fluctuate in the short term and contrast short-term and long-term economic performance. 5) How can we use the aggregate demand and supply models to study the sources...
Evaluate the following situations affecting the aggregate demand curve.(2+2-4 marks) (G) If the government cuts personal income taxes, what will happen to aggregate demand and demand curve, (1+1=2 marks), and (ii) If the government increases the taxes, what will happen to aggregate demand and demand curve Support our answer with diagram. (1+1-2 marks) End of Question Paper. Good Luck.
1. Which of the following is not a property of the aggregate demand curve? It shows the relationship between the overall price level and level consumption. It shows the price level on the vertical axis and output on the horizontal axis. The aggregate demand curve slopes downward. It shows the relationship between the overall price level and the level of total demand. 2. When the price level increases people: feel more wealthy. have the same real value of assets, regardless...
1. Explain why the aggregate demand (AD) curve is downward slopping (on the two dimensional price and output planes) in the neoclassical ASAD model. 2. Explain why the aggregate demand (AD) curve is downward slopping (on the two dimensional price and output planes) in the Post-Keynesian ASAD model. 3-4. In the neoclassical ASAD model, let us suppose that the interest rate has no effect on investment. What does this imply for (1) the slope of the IS curve, for (2)...
(3) For the following velocity fields F on R3, find the flow along the given curve. r(t) = (t, t2, 1) F=(-4xy, 83, 2) with 0 2 t 1l F=(z-z, 0,2) r(t)-(cost, 0, sin t) with 0 t π F = (-y,2, 2) with r(t) = (-2 cost, 2 sin t, 2t) 0 < t < 2π
(3) For the following velocity fields F on R3, find the flow along the given curve. r(t) = (t, t2, 1) F=(-4xy, 83,...
where s is a supply shock term, on average equal to zero. Draw the Phillips curve when U = 700 and underlying inflation π = 3% and 6%. Okun's Law is un s Law is U-U=-0.5 (Y--)/- Draw the aggregate supply schedule when Y = 10,000
where s is a supply shock term, on average equal to zero. Draw the Phillips curve when U = 700 and underlying inflation π = 3% and 6%. Okun's Law is un s Law...
SAME TASK AS WRITTEN:
3.a) A Philips curve is represented by the following
relationship:
π = ?̃ – 10(U – ?̅) + s, where s is a supply shock term, on
average equal to zero.
Draw the Phillips curve when ?̅ = 7% and underlying inflation ?̅
= 3% and 6%.
Okun’s Law is
U – ?̅ = -0.5 (Y – ?̅)/?̅.
Draw the aggregate supply schedule when ?̅ = 10,000.
3. B) Using the conditions of the above exercise,...
please help both 1. when the aggregate supply curve is vertical, which of the following is not true? 1. the economy is producing the maximum sustainable level of output. 2. any increase in the price level will not cause an increase in aggregate output. 3. the economy is expanding quickly 4. the economy is at capacity 2. if the economy is operating on the relatively vertical segment of the aggregate supply curve, an increase in aggregate demand causes a ________...
38.39,40
Question 38 (2 points) When potential GDP increases. 1) the AS curve shifts rightward. 2) there is a movement up along the AS curve. 3) the AS curve shifts leftward. 0 4) there is a movement down along the AS curve. Question 39 (2 points) Which of the following produces a movement along the aggregate demand curve? 1) a change in foreign incomes 2) a change in the price level 3) a change in monetary policy 4) a change...