QUESTION 43 Suppose the U.S. government increases the amount...

QUESTION 43 Suppose the U.S. government increases the amount of steel that can be exported to foreign countries. What will happen in the domestic market for steel? Oa. The domestic demand for steel will decrease, leading to a higher equilibrium price. Ob. The domestic supply of steel will decrease, leading to a higher equilibrium price. Oc. The domestic supply of steel will increase, leading to a lower equilibrium price. Od. The domestic demand for steel will increase, leading to a lower equilibrium price.

Transcript

00:01 So for this question, we're giving like about nine questions or ten questions.

00:07 Or we're to determine me what effects would each of them have on the aggregate demand or aggregate supply, all other things equal.

00:16 And yeah, the first question, so i want to find what effects each of them will have on the aggregate demand or aggregate supply.

00:38 So the first question is a wild spread unfair by consumers of an impending economic depression.

00:50 So for this one, the aggregate demand would decrease.

00:56 And this is due to the fact that, you know, consumers are scared of depression and they'll reduce their expenditures.

01:04 And it will lead to like a foreign aggregate demand.

01:07 So we can say that aggregate demand would decrease.

01:27 The second one is a new national tax on producers based on the value added between the cost of the imputes and the revenue received from the output.

01:44 For this one, the aggregate supply would decrease because the new tax, this is due to the fact that the new tax owed the cost of production and the increase.

01:58 In the increase in it will lead to no fall in aggregate supply by the production because if you increase the cost it would also lead to a fall in aggregate supply by production so for this one aggregate supply will decrease for the next question a reduction in interest rate at each price level for this one aggregate demand will increase and this is due to the fact that reduction in interest rates because we're reducing interest rate right reduction in interest rate will reduce the cost of investment and when you know this cost is low when the cost of investment is low the aggregate demand will increase because the cost for investing is low so they'll demand more for it and you know the investment is you know at a low cost at a low note of interest so then the demand increase so aggregate demand will increase...

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