Consider the short-run and long-run aggregate supply curves in the graph to the right. Using the line drawing tool, draw and label a new SRAS curve that shows the effect of the following event: A reduction in input prices. Carefully follow the instructions above, and only draw the required object.
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- The following table lists several determinants of aggregate supply. Fill in the table by indicating the changes in the determinants necessary to increase aggregate supply. Determinant Prices of Nonlabor Inputs Productivity Nominal Wage Rate Change Needed to Increase Short-Run Aggregate SupplyConnect assignment O es Use the following information to draw aggregate demand (AD) and aggregate supply (AS) curves on the following graph. Output Demanded (Aggregate Demand) Output Supplied (Aggregate Demand) Price Level 600 100 Price Level (average price) Instructions: Use the tools provided 'AD' and 'AS' to plot the aggregate demand (AD) and aggregate supply (AS) curves. Plot only the endpoints of each line (plot 2 points for each line-4 points total). Both curves are assumed to be straight lines. 900 800 700 600 500 400 300 200 100 0 0 $700 100 Aggregate Supply and Demand 200 $800 100 900 900 900 900 90 900 900 700 Real Output (quantity per year) Instructions: Enter your response as a whole number. a. What is the equilibrium price level? $ Tools AD D AS e b. What curve (AD or AS) would have shifted if a new equilibrium were to occur at an output level of 600 and a price level of $600? O AS would have shifted to the right. O AS would have shifted to the left. O AD would have…Create a graph for a short-run aggregate supply curve. Use the variable ‘Price Level’ for the vertical axis and ‘Real GDP’ for the horizontal axis In your answer, explain why there is a direct relationship between the price level and real GDP. Use your graph to illustrate your explanation. Also, discuss determinants of Aggregate Supply or factors that shift Aggregate Supply curve. (200 to 300 words) .
- owing graph plots aggregate demand (ADar) and aggregate supply (AS) for the imaginary country of Patagonia in the year 2027. the natural level of output in this economy is $6 trillion. following graph, use the green line (triangle symbol) to plot the long-run aggregate supply (LRAS) curve for this economy. plete the table by entering the inflation rate at each potential outcome point. Calculate the inflation rate to two decimal points of precision. Unemployment Rate 3% 5% Inflation Rate LRAS AS AD ADE 12 14 16 OUTPUT (Trillions of dollars) 43 +1 Outcome C ists forecast that if the government takes no action and the economy continues to grow at the current rate, aggregate demand in 2028 will the curve labeled ADA, resulting in the outcome given by point A. If, however, the government pursues an expansionary policy, aggregate in 2028 will be given by the curve labeled ADg, resulting in the outcome given by point B. >wing table presents projections for the unemployment rates that would…Define aggregate supply. Give three reasons why the aggregate supply curve slopes upward. Explain the determinants of the aggregate supply (AS) and describe how the AS curve will shift when one of these determinants changes.Suppose that because of globally adverse meteorological conditions, there are serious concerns of climbing prices in an extensive group of commodities. As a result, people now expect an acute increase in the level of input prices. The figure shows aggregate demand (AD), short‑run aggregate supply (SRAS), and long‑run aggregate supply (LRAS). Move one or more of these curves to describe the short‑run effect this would have in the economy and answer the two questions. Adjust graph in picture. In the short run, price level a. increases. b. decreases. c. The change is indeterminate. In the short run, real GDP (or aggregate output) a. The change is indeterminate. b. decreases. c. increases.
- The following graph shows an increase in short-run aggregate supply (SRAS) in a hypothetical economy. Specifically, short-run aggregate supply shifts to the right from SRAS₁ to SRAS2, causing the quantity of output supplied at a price level of 125 to rise from $250 billion to $350 billion. Review the graph and then complete the table that follows. PRICE LEVEL 200 175 150 125 100 75 50 25 0 0 50 SRAS SRAS₂ 100 150 200 250 300 350 400 REAL GDP (Billions of dollars) ? The following table lists several determinants of short-run aggregate supply. Complete the table by indicating the change needed in each determinant to increase short-run aggregate supply. Determinant Change Needed to Increase SRAS Input Prices increase or decrease Burdensome Regulations increase or decrease Technology decline or improvementDescribe the change in aggregate supply that should result from each of the following changes in determinants. Assume that nothing else is changing besides the identified change. (In your answer, indicate whether the change will "Decrease" or "Increase" aggregate supply or have no effect.) (a) A rise in the average price of inputs; (b) An increase in worker productivity; (c) Government antipollution regulations become stricter; (d) A new subsidy program is enacted for new business investment in productive equipment; (e) Energy prices decline.Your company sells wristwatches in three separate markets: China, Japan and Korea. The demand curves are 9c = 50 9j = 75 - - qk 100 4 2 Pc P₁ · Pk. a) Calculate and plot the inverse demand curve for each market. b) Calculate your aggregate demand curve. c) Calculate and plot your inverse aggregate demand curve.
- The following graph represents the short-run aggregate supply curve (SRAS) based on an expected price level of 120. The economy's full- employment output level is $9 trillion. Major unions across the country have recently negotiated three-year wage contracts with employers. The wage contracts are based on an expected price level of 120, but the actual price level turns out to be 160. Show the short-run effect of the unexpectedly high price level by dragging the curve or moving the point to the appropriate position. PRICE LEVEL (CPI) 240 200 160 40 0 0 3 SRAS[120] 6 9 12 REAL GDP (Trillions of dollars) 15 18 SRAS[120] 0 (?) Interpret the change you drew on the previous graph by filling in the blanks in the following paragraph:The following graph represents the short-run aggregate supply curve (SRAS) based on an expected price level of 180. The economy's full- employment output level is $9 trillion. Major unions across the country have recently negotiated three-year wage contracts with employers. The wage contracts are based on an expected price level of 180, but the actual price level turns out to be 240. Show the short-run effect of the unexpectedly high price level by dragging the curve or moving the point to the appropriate position. PRICE LEVEL (CPI) 380 300 240 180 80 0 3 SRAS[180] 9 12 REAL GDP (Trillions of dollars) 15 18 0 SRAS[180] 0Which of the following would cause the Aggregate Supply curve to move from AS to AS2 in the graph below? A) A general increase in energy and labor cost for businesses. B) A general decrease in labor cost for businesses. C) An increase in productivity. D) A federal government increase in spending.
