Market-clearing models are developed to analyze macroeconomic issues
a. In the long run and in the short run
b. In the long run and in the short run
c. Neither in the long run nor in the short run
d. Neither in the long run nor in the short run
Option A and B both correct
Both these options are suggesting that macroeconomic issues are discussed both for the long run as well as for the short run. The short run is basically considered vital because economic problems arise in the short run and solved by the discretion of the government or the central bank in the short run and through self adjustment process in the long run
Market-clearing models are developed to analyze macroeconomic issues a. In the long run and in the...
The economy is in long-run macroeconomic equilibrium when the point of short-run macroeconomic equilibrium is on the long-run aggregate supply curve. Using a graph, depict and explain the short-run versus long-run effects of: I. A contractionary monetary policy resulting in demand shock on the long-run macroeconomic equilibrium. Use one contractionary monetary policy to illustrate your analysis, explain the nature of the policy and clearly depict the direction of the shift and changes in the equilibrium point, where necessary. II. An...
Deadweight losses are associated with monopolistic competition: a. In both the short and long run b. In neither the short run nor the long run c. In the long run, but not the short run d. In the short run, but not the long run
Distinguish between the short-run and the long-run in a macroeconomic analysis. Why is the relationship between unemployment and inflation different in the short-run and the long-run?
Assume that an economy is in long-run macroeconomic equilibrium. All the usual assumptions of the dynamic demand and supply model Firms and workers expect there to be a decline in the inflation rate in the coming year As a result, the LRAS curve will The SRAS curve will The AD curve will The new long-run equilibrium will be where O A. the new aggregate demand curve intersects the new short-run aggregate supply curve on the onginal long-run aggregate supply curve....
Using words and graphs analyze the macroeconomic effects of expansionary fiscal policy in the short run. Provide as much detail as possible.
7. Most economists believe that prices are: a) flexible in the short run but many are sticky in the long run. b) flexible in the long run but many are stick in the short run. c) sticky in both the short and long runs. d) flexible in both the short and long runs. 8. If the short run aggregate supply curve is horizontal, then changes in aggregate demand affect: a) level of output but not prices. b) prices but not...
In the Four-Graph macroeconomic long-run model (labor market, aggregate production function, diagonal line to shift Y, and AD-AS), what does it say about output and employment?
of a closed economy. when 6. According to the classical long-run macroeconomic model of a co decrease and government spending is unchanged a consumption and investment both increase b. consumption and investment both decrease c consumption increases and investment decreases d. consumption decreases and investment increases. 7. Suppose a business-friendly billionaire becomes president. As a result, businesses become optimistic about the future and more eager than before to increase their investment spending According to the classical long-run macroeconomic model of...
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emergency thanks
13. Suppose the economy is currently in long run macroeconomic equilibrium, with actual GDP equal to potential GDP. (a) Depict this situation using AD-AS, being sure to label all curves and axes. 5 points. The government invests significant resources in building new schools and universities. (b) Depict the effect on prices and output this will have on AD-AS model and the new short run equilibrium (You can use the same graph as in (a) as long as...
1. Monetary neutrality is a characteristic of the aggregate demand-aggregate supply model in: the long run, but not in the short run. the short run, but not in the long run. both the short run and the long run. neither the short run nor the long run.