How do fluctuations in aggregate demand and short-run aggregate supply bring fluctuations in real GDP around potential GDP? Starting from a full-employment equilibrium, a decrease in aggregate demand and creates gap. O A. increases real GDP above potential GDP; an inflationary O B. decreases real GDP below potential GDP; an inflationary OC. increases real GDP above potential; a recessionary D. decreases real GDP below potential GDP; a recessionary short-run aggregate and the economy returns to a full-employment In the long run, the money wage rate supply equilibrium. OA. rises; increases OB. falls; decreases OC. rises; decreases O D. falls; increases

How do fluctuations in aggregate demand and short-run aggregate supply bring fluctuations in real GDP around potential GDP? Starting from a full-employment equilibrium, a decrease in aggregate demand and creates gap. O A. increases real GDP above potential GDP; an inflationary O B. decreases real GDP below potential GDP; an inflationary OC. increases real GDP above potential; a recessionary D. decreases real GDP below potential GDP; a recessionary short-run aggregate and the economy returns to a full-employment In the long run, the money wage rate supply equilibrium. OA. rises; increases OB. falls; decreases OC. rises; decreases O D. falls; increases

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Investment tax credits are intended to productivity, shifting the curve to the a. increase; long-run aggregate supply; right O b. increase; long-run aggregate supply; left ○ c. increase; aggregate demand; left O d. decrease; long-run aggregate supply; left
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According to Say's law which of the following statement is correct O a. The equilibrium of national income occurs where aggregate demand is equal to aggregate supply. b. Demand creates supply O c. None O d. Supply creates it's on demand O e. Full employment creates
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Price level (CPI) Exhibit 10A-6 Aggregate demand and supply model 250 200 150 100 50 0 2 E₂ 4 LRAS 6 SRAS₁ Given the shift of the aggregate demand curve from AD1 to AD2 in Exhibit 10A-6, the real GDP and price level (CPI) in long-run equilibrium will be: O a. $10 billion and 200. O b. $10 billion and 150. O c. $10 billion and 100. O d. $4 billion and 150. SRAS₂ AD₁ 8 10 12 14 15 16 17 Real GDP (billions of dollars per year) AD₂
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An economy has a recessionary gap. With no change in aggregate demand, how does the economy return to full employment? O A. The money wage rate rises, real GDP increases, and the price level falls. O B. The money wage rate falls, real GDP increases, and the price level rises. O C. The money wage rate falls, aggregate supply increases, and the price level falls. O D. The money wage rate rises, real GDP decreases, and the price level rises. -to ooloct vour answer.
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