Name some factors that could cause AD to shift, and say whether they would shift AD to the right or to the left.

Q: Graphically explain recessionary and inflationary gaps using AD and AS curves.

A: The below graph slows the recessionary gap and inflationary gap:

Q: 15. Consider the AD/AS model, and suppose that the economy begins at potential output. Through the…

A: Initially, the economy is at equilibrium A producing potential output Y* and the price level is P*.…

Q: How do propensities and multipliers, and even expectations affect the outcomes in a downturn

A: In an economy, when talking about propensity, expectations and multipliers, these are the ratios of…

Q: Discuss the various factors affect aggregate supply curve shift.

A: The aggregate supply curve is one of the most determinant of the determination of the output or the…

Q: (b) Increased job opportunities in the Greater Bay Area cause many people to leave Macao, explain…

A: When people leave Macao for better job opportunities in Greater Bay Area, both the Aggregate Demand…

Q: Explain the determinants of the aggregate demand (AD) and describe how the AD curve will shift when…

A: The main four components of aggregate demand are consumption, investment, government spending, and…

Q: When consumers’ expected income decreases, this leads to ​A. Positive shift (increase) in AD ​B.…

A: Expected income of consumers and aggregate demand AD have positive relationship.

Q: The price level rises, and this changes the real value of consumers’ wealth. Does this cause a…

A: The rise or fall in price level leads to movement along the demand curve other things being…

Q: Draw the equilibrium in IS-LM-BP curve.

A: IS-LM: The IS-LM is a macroeconomic model which is used to represent how the money and product…

Q: Explain what is meant by aggregate demand. Then how to derive the AD curve and why the AD curve has…

A: The total amount of demand for all of the finished goods and services being produced at various…

Q: Show shifts in AD using LM curve.

A: AD curve shows the inverse relation between the price level (aggregate) and the national income

Q: The graphs illustrate an initial equilibrium for some economy. Suppose that the economy experiences…

A: Aggregate demand is a macroeconomic concept that represents the total demand for all finished goods…

Q: Derive AD curve using Y=AE and show the shifts of AD curve.

A: The aggregate demand (AD) curve indicates the negative relationship between the price level and…

Q: Does the AD curve shift?

A: AD (Aggregate demand) depicts sum dd (demand) for the nation and how it interconnects at the level…

Q: Use an IS curve and an MP curve to derive graphicallythe AD curve

A: The IS curve expresses the equilibrium in the goods market. It is a negatively sloped curve that…

Q: Illustrate graphically and explain the derivation of the aggregate demand curve from the IS and LM…

A: IS-LM: The IS-LM is an macroeconomic model that describes how the money market interacts with the…

Q: Question 2 Answer the following questions clearly. a. What are the characteristics of AD? Derive the…

A: As economies and societies developed, the study of economics got more complicated. Hence, as a…

Q: Question 8 Two other events that would shift AD to the right are Question 9 and

A: Aggregate demand, on the other hand, calculates the entire dollar worth of the market for every…

Q: Construct the AD, SRAS, and LRAS curves for an economy experiencing (a) full employment, (b) an…

A: (a) Full employment: full employment is the situation in which all labors from the labor force work…

Q: Give examples of the factors that shift the Aggregate Demand Curve.

A: Aggregate demand is the sum of Consumption, Investment , government spending.  So,  AD = C + I + G.…

Q: In 2013, Prussia's aggregate demand curve was determined by the equation M + 1-4% A change in…

A: The quantity theory of money:The quantity theory of money equation can be written as follows:

Q: Identify three factors that can shift the aggregatedemand curve to the right and three different…

A: AD(aggregate demand curve) represent the aggregate services and goods are demanded by the society at…

Q: Will the shift of SRAS to the right tend to make the equilibrium quantity and price level higher or…

A: The total supply of goods and services that companies in a national economy expect to sell over a…

Q: The following table lists several determinants of aggregate demand. Complete the table by indicating…

A: Aggregate demand represents the total demand for goods and services in an economy at any given price…

Q: Inflation is increasingly becoming a concern among economists. One of the heads of Bank of America…

A: The aggregate demand is downward sloping and aggregate supply is upward sloping. They come together…

Q: Why the AD curve always negative?

A: The AD (Aggregate Demand) curve represents the relationship between the price level and the quantity…

Q: Define what economists mean when they use the word: “recession”?

A: GDP is used to measure total income in the economy.   It is the value of final goods and services…

Q: AD will shift to the right, other things being equal, when

A: aggreagate demand is defined as the total demand of goods and services within an economy. Now, AD =…

Q: What are some examples of changes in the economy that would lead to a movement along the IS curve?…

A: IS Curve shows relationship between interest rates and output level in the economy.

Q: The AD curve can be shifted by...

A: AD Curve: The aggregate demand (AD) curve represents the total goods and services demanded by the…

Q: 1. Based on the table, identify and explain the components of Aggregated Demand. Show the variation…

A: Aggregate demand is the demand for all the finished goods and services in the economy. The equation…

Q: Do you believe that the Hayek’s classical AD-AS model explain the factors that cause changes…

A: 1.2 The Hayek’s classical model illustrates the aggregate supply curve as a vertical straight line…