Question content area Part 1 In the dynamic aggregated demand and aggregate supply model, if AD shifts further than AS Part 2 A. deflation occurs. B. stagflation occurs. C. disinflation occurs. D. inflation occurs.
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Aggregate Demand represents the total demand for goods and services in an economy at a given overall price level and in a given time period. Aggregate Supply represents the total supply of goods and services that firms in an economy plan to sell during a specific Show more…
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Crystal W.
4. The economy's short-run equilibrium price level and aggregate output (income) are found at the intersection of the aggregate demand (AD) and aggregate supply (AS) curves. Recall that the price level is located on the y-axis and output (income) on the x-axis. Which of the following would cause a new equilibrium with a lower price level and a higher output (income)? O A. A rightward shift in AD. O B. A rightward shift in AS. O C. A leftward shift in AS. O D. A leftward shift in AD. Which of the following events could have caused this particular change? A. An increase in bad weather and natural disasters. B. A sharp increase in immigration. C. A reduction in the country's labor force participation rate. D. An increase in entrepreneurial taxes and regulations. 6. Suppose the economy is initially in short-run equilibrium at a given price level and equilibrium aggregate output (income). What would be the impact of the following event? Event: Consumer and business optimism sharply increases. A. The aggregate supply curve shifts to the right. B. The aggregate supply curve shifts to the left. C. The aggregate demand curve shifts to the right. D. The aggregate demand curve shifts to the left. The short-run result of this event is that A. the price level falls and aggregate output (income) rises B. the price level rises and aggregate output (income) falls C. both the price level and aggregate output (income) decrease D. both the price level and aggregate output (income) increase 8. How would the following event impact the economy's short-run aggregate supply (AS) curve? Event: High taxes and excessive regulation cause firms to reduce the quantity of their physical capital. A. The AS curve shifts rightward. B. The AS curve remains unchanged. C. The AS curve becomes horizontal. D. The AS curve shifts leftward. 9. A negative supply shock, such as an increase in oil prices, causes the short-run aggregate supply curve to A. increase and therefore shift to the left B. increase and therefore shift to the right C. decrease and therefore shift to the right D. decrease and therefore shift to the left
Luke H.
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