
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Transcribed Image Text:The figure to the right shows the determination of the economy's short run
equilibrium price level and aggregate output (income).
Draw a single line or curve (either AD or AS) such that a new equilibrium occurs
with a lower price level and a higher output (income).
NOTE: Shifts in AD require the line drawing tool while the three-point curved line
drawing tool is used to shift AS. Properly label your new line or curve.
Note: Carefully follow the instructions above, and only draw the required object.
Which of the following events could have caused this particular change?
A. A sharp increase in immigration.
B. An increase in bad weather and natural disasters.
OC. A reduction in the country's labor force participation rate.
OD. An increase in entrepreneurial-stifling taxes and regulations.
Price level, P
Aggregate output (income), Y
ASO
ADO
O
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