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Use an aggregate demand and supply graph to predict the effects of COVID-19 pandemic on inflation and output.
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- can you expand on the question and provide a demand and supply diagram relating to the topic "disequilibrium"What are the sources of determinants of energy price shocks.Describe the economic effects of the current pandemic. How would it affect the Aggregate Demand and Aggregate Supply graph? What are some of the global aspects of the situation?
- Use aggregate demand (AD) and supply (AS) analysis to predict the effects of COVID-19 pandemic on inflation and output. Show and describe the effects in both the short run and the long run. (Demonstrate these effects on a graph) (Hint: First, classify the COVID-19 pandemic as a supply shock or a demand shock or both)Define Inflation. Explain why inflation is a macroeconomic concernAggregate Supply Aggregate Demand Price Level rGDP Price level rGDP 115 620 100 660 640 120 110 650 125 660 640 120 130 680 130 630 140 700 140 620 150 712 150 610 160 722 160 600 170 730 170 590 You may find the “Centauri 2112" Excel file useful in your efforts. The AI that runs your actuarial department has calculated that, at any price level, Centauri's aggregate demand has the equation AD = 0.75(Y – T) + G, where Y is real GDP, T is total taxes, I is investment and G is government spending. Everything is measured in billions of 2099 Cents (denoted C). The government reports that taxes are T = 60 and government expenditures are G = 205. a) By how much will a 10-Cent decrease in taxes T increase Aggregate Demand? b) By how much will a 10-Cent increase in government spending G increase Aggregate Demand?. c) Which policy is a more effective way to change Aggregate Demand? d) Determine a policy that will return the Centauri economy to its long-run equilibrium. That is, figure out a…
- True/ false . The purchasing power and inflation have an inverse relationship.What is the relationship in ADAS between oil price and inflation and also the unemployment rate? Given that Oil prices keep increasing The consumer price index keeps increasing The unemployment rate keeps decreasingPlease draw the Philips curve with a positive relationship between aggregate output and inflation and another that shows an upward shift in the whole curve (brief explanation please as trying to understand it (: )
- Please draw four AD/AS diagrams (t-0,1,2,3) to show how the Covid-19 pandemic has affected our economy as economic shocks (without any government intervention) in short-run and long-run. Please show the adjustment process in one of your diagrams. Please write a short explanation for each diagram that you draw.In which of the following situations will demand pull inflation fall? a) Rising aggregate supply b) Reduced taxes c) Rising incomes d) Decreased imports e) Aggregate demand rising with aggregate supply lagsExplain macro economics