Macroeconomics
13th Edition
ISBN: 9780134735696
Author: PARKIN, Michael
Publisher: Pearson,
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Chapter 27, Problem 15APA
To determine
Identify the impact of events on the Country U’s real GDP and the price level from the position of long-run equilibrium.
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Determinants of aggregate supply
The following graph shows an increase in short-run aggregate supply (AS) in a hypothetical economy where the currency is the dollar. Specifically, the short-run aggregate supply curve shifts to the right from AS1AS1 to AS2AS2, causing the quantity of output supplied at a price level of 100 to rise from $200 billion to $250 billion.
The following table lists several determinants of short-run aggregate supply.
Complete the table by selecting the changes in each scenario necessary to increase short-run aggregate supply.
Change Necessary to Increase AS
Technology
(DECLINES or IMPROVES)
Human capital
(IMPROVES or DECLINES)
Inflation expectations
(HIGHER or LOWER)
The data below represents the price level, the aggregate demand, and the aggregate supply data for an economy. Use the
data points to plot an aggregate demand curve and aggregate supply curve for this economy.
Each curve is labeled as AS (Aggregate Supply) or AD (Aggregate Demand) and each point is labeled as a, b, or c from the
table headings.
(Hint: Note that point a from the AD curve is already plotted with the correct coordinates. Plot the remaining points.)
Provide your answer below:
Price Level
-100
200
180
160-
140-
120
AS: a ($140,100) AS: b ($300, 100) AS: c ($500,100)
100-
-80
-60
40
20
0
-20
AD: c ($100,80)
100
Price Level
Aggregate Supply (AS)
Aggregate Demand (AD)
200
AD: b ($300,80) AD: a ($390,80)
300
400
600
500
Real GDP ($)
a
b
120
80
$320 $420
$390 $340
C
170
$540
$280
Chapter 27 Solutions
Macroeconomics
Ch. 27.1 - Prob. 1RQCh. 27.1 - Prob. 2RQCh. 27.1 - Prob. 3RQCh. 27.1 - Prob. 4RQCh. 27.2 - Prob. 1RQCh. 27.2 - Prob. 2RQCh. 27.2 - Prob. 3RQCh. 27.3 - Prob. 1RQCh. 27.3 - Prob. 2RQCh. 27.3 - Prob. 3RQ
Ch. 27.3 - Prob. 4RQCh. 27.4 - Prob. 1RQCh. 27.4 - Prob. 2RQCh. 27.4 - Prob. 3RQCh. 27 - Prob. 1SPACh. 27 - Prob. 2SPACh. 27 - Prob. 3SPACh. 27 - Prob. 4SPACh. 27 - Prob. 5SPACh. 27 - Prob. 6SPACh. 27 - Prob. 7SPACh. 27 - Prob. 8SPACh. 27 - Prob. 9SPACh. 27 - Prob. 10APACh. 27 - Prob. 11APACh. 27 - Prob. 12APACh. 27 - Prob. 13APACh. 27 - Prob. 14APACh. 27 - Prob. 15APACh. 27 - Prob. 16APACh. 27 - Prob. 17APACh. 27 - Prob. 18APACh. 27 - Prob. 19APACh. 27 - Prob. 20APACh. 27 - Prob. 21APACh. 27 - Prob. 22APACh. 27 - Prob. 23APACh. 27 - Prob. 24APACh. 27 - Prob. 25APACh. 27 - Prob. 26APA
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