Business, 12.01.2021 18:10 rebecca52360

Suppose the full-employment level of real output ( Q) for a hypothetical economy is $250 and the price level ( P) initially is 100. Use the short-run aggregate supply schedules below to answer the questions that follow: AS(P100) AS(P125) AS(P75)
P Q P Q P Q
125 $280 125 $250 125 $310
100 250 100 220 100 280
75 220 75 190 75 250

Required:
a. What will be the level of real output in the short run if the price level unexpectedly rises from 100 to 125 because of an increase in aggregate demand? What if the price level unexpectedly falls from 100 to 75 because of a decrease in aggregate demand? Explain each situation, using numbers from the table.
b. What will be the level of real output in the long run when the price level rises from 100 to 125? When it falls from 100 to 75? Explain each situation.
c. Show the circumstances described in parts a and b on graph paper, and derive the long-run aggregate supply curve.

Answers: 3

Show answers

Another question on Business

Business, 22.06.2019 01:10

Suppose someone wants to sell a piece of land for cash. the selling of a piece of land represents turning econ

Answers: 3

Answer

Business, 22.06.2019 06:10

Investment x offers to pay you $5,700 per year for 9 years, whereas investment y offers to pay you $8,300 per year for 5 years. if the discount rate is 6 percent, what is the present value of these cash flows? (do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) present value investment x $ investment y $ if the discount rate is 16 percent, what is the present value of these cash flows? (do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) present value investment x $ investment y

Answers: 1

Answer

Business, 22.06.2019 07:30

Hours to produce one unit worker hours to produce yarn country a 8 hours country b 4 hours worker hours to produce fabric counrty a 12 hours country b 13 hours additional worker hours to produce fabric instead of yarn country a ? country b? which of the follow is true of the trade relationship between country a and country b? country a has an absolute advantage in producing yarn and fabric country b has an absolute advantage in producing yarn and fabric country b has a comparative advantage to country a in producing fabric country a has a comparative advantage to country b in producing fabric

Answers: 2

Answer

Business, 22.06.2019 09:50

phillips, inc. had the following financial data for the year ended december 31, 2019. cash $ 41,000 cash equivalents 75,000 long term investments 59,000 total current liabilities 149,000 what is the cash ratio as of december 31, 2019, for phillips, inc.? (round your answer to two decimal places.)

Answers: 3

Answer

You know the right answer?

Suppose the full-employment level of real output ( Q) for a hypothetical economy is $250 and the pri...

Questions