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- A vertical long-run aggregate supply curve shows that:(a) wages and prices are sticky.(b) changes in technology do not affect the productive capacity of the economy.(c) the availability of resources does not affect the productive capacity of the economy.(d) changes in the price level do not affect the full employment productive capacity of the economyPlease answer all parts of the question! Thank you! 1. Answer each of the questions completely. Make sure your example clearly demonstrates your understanding of each concept. (a) Describe the four shifters of Aggregate Demand AND provide an example of each (____/2) (b)Describe the three shifters of Aggregate Supply AND provide an example of each (____/1) (c) What shifters the Long-Run Aggregate Supply Curve? (____/1) (d) Explain what an Inflationary (Positive Output) Gap and a Recessionary (Negative Output) Gap are, including what happens to unemployment and output (____/2)Which circumstance would contribute to a relatively flat slope of the short-run aggregate supply curve?(a) An increase in investment spending on residential construction causes an increase in wages for skilled carpenters.(b) An increase in foreign tourists coming to the United States causes an increase in prices of lodging at resort destinations.(c) A high number of vacancies in a shopping mall allows retail tenants to take on larger spaces with no increase in rent.(d) An increase in consumption spending on home furnishings allows furniture stores to reduce the number of promotional discounts offered.
- Assume the Australian economy is originally at the long-run equilibrium. An abrupt house price crash sends shockwaves throughout the economy. In response to such a shock, households bring their spending on durable goods to the bare minimum, while firms cancel all future upgrade or expansion projects. Required: (a) Explain how the long-run aggregate supply (LRAS), the short-run aggregate supply (SRAS) and the aggregate demand (AD) will be affected by the above shock. Clearly explain why such change(s) would occur. (b) Clearly explain how the above shock would affect the key macroeconomic variables (real GDP, unemployment rate and price level) in the short run. (c) In order to counteract the above shock, do you recommend the government to implement expansionary fiscal policy or contractionary fiscal policy? Clearly explain why. (d) Clearly explain what actions the government can undertake in order to implement the fiscal policy stance recommended in (c).(1) Suppose the economy is in long-run equilibrium. If there is a sharp increase in the expected price level, what do we expect to happen? Select one: (A) In the short run, the SRAS curve will shift left, real GDP and price will fall. (B) In the short run, SRAS will shift right, real GDP will rise and prices will fall. (C) In the short run, AD will shift left, real GDP and prices will fall. (D) In the short run, LRAS and SRAS will shift left, causing real GDP to fall.QUESTION 4 (a) Price can affect the aggregate supply curve (AS). Can you identify factors other than price that might affect the AS curve? (b) Much of the current labor force in Malaysia is from other countries such as Indonesia, Vietnam, India, and Philippines. What is the effect of these foreign workers on our local skills and expertise in respect to the job market?
- Suppose firms become very optimistic about future business conditions and invest heavily in new capital equipment. a. Draw an aggregate-demand/aggregate-supply diagram to show the short-run effect of this optimism on the economy. Label the new levels of prices and real output. Explain in words why the aggregate quantity of output supplied changes. b. Now use the diagram from part (a) to show the new long-run equilibrium of the economy. (For now, assume there is no change in the long run aggregate-supply curve.) Explain in words why the aggregate quantity of output demanded changes between the short run and the long run. c. How might the investment boom affect the long run aggregate-supply curve? Explain Plaese mam/sir give me answer in deatail as soon as possible pleaseShow the effect this shock has on the market for pistachios by shifting the demand curve, supply curve, or both. Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. PRICE (Dollars per ton) 40 32 24 16 8 0 8 16 24 Demand QUANTITY (Thousands of tons) Supply 32 40 Demand -- Supply ?Show the effect this shock has on the market for almonds by shifting the demand curve, supply curve, or both. Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. PRICE (Dollars per ton) 40 32 32 Supply Demand 24 24 16 8 0 8 16 24 Demand QUANTITY (Thousands of tons) 32 40 Supply One of the growers is pleased with the price increase caused by the pests because she believes it will lead to increased revenue. Using elasticities, you will be able to determine whether this price change will lead to a rise or fall in total revenue in this market. Using the midpoint method, the price elasticity of demand for almonds between the price levels of $20 and $28 per ton is between these two points, demand is . Thus, you can conclude that the grower's claim is due to the pestilence. meaning that because total revenue will Confirm your previous…
- According to the Congressional Budget Office's projections, real GDP in 2007 was marginally higher than real potential GDP. If potential GDP is correctly assessed, then during that period : (A) the economy was on its long run aggregate supply curve. (B) the economy was to the left of its long run aggregate supply curve. (C) the economy was slightly to the right of its long run aggregate supply curve.Which of the following would cause a leftward shift of aggregate demand?(a) An expectation of increased business regulation and restrictions on the use of technology causes a decrease in investment spending.(b) A decrease in interest rates causes an increase in investment spending.(c) A depreciation of the domestic currency on foreign exchange markets causes an increase in net exports.(d) A decrease in income tax rates results in more disposable income for households and increased consumer spending.Which event would shift short-run aggregate supply to the right? (a) A labor shortage puts upward pressure on wages, causing an increase in the expected rate of inflation. (b) An increase in government regulation makes it more costly for firms to comply with legislative requirements. (c) Expecting inflation to increase, workers bargain for higher wages. ( d) Internet technology allows retailers to use just-in-time delivery of merchandise, thereby lowering inventory costs. Only typed answer and don't use chat gpt
