Exam 20: Aggregate Demand and Aggregate Supply: Part A

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The exchange-rate effect helps explain what feature in the aggregate demand and aggregate supply model?

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Question 1

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why the aggregate-demand curve slopes downward

Explain how a recession differs from a depression.

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Question 2

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Recessions are relatively mild periods of declining real incomes and rising unemployment. Depressions are severe recessions.

Figure 33-12. -Refer to Figure 33-12.Explain how the aggregate demand and aggregate supply model changed during periods 1 and 2.

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Question 3

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The aggregate-demand curve declined during period 1, and increased during period 2.

Figure 33-13. -Refer to Figure 33-13.Identify the price and output levels consistent with long-run equilibrium.

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Question 4

Figure 33-16. -Refer to Figure 33-16.Suppose the economy starts at P₃ and Y₂.If there is a decrease in government purchases,identify the price and output levels that the economy would move to in the short run.

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Question 5

Misperceptions theory helps explain what feature of the aggregate demand and aggregate supply model?

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Question 6

Other things the same,what happens in the short run to the price level and quantity of output when the aggregate demand curve shifts to the left?

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Question 7

Suppose the expected price level increases.Which curves in the aggregate demand and aggregate supply model would be affected,and which way would they shift?

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Question 8

What variables besides real GDP tend to decline during recessions? Given the definition of real GDP,argue that declines in these variables are to be expected.

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Question 9

During periods of stagflation,what happens to output and prices in the economy?

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Question 10

Other things the same,what happens in the long run to the price level and quantity of output after a contraction in aggregate demand?

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Question 11

Make a list of expenditures whose sum equals GDP.

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Question 12

Explain how a change in the expected price level would shift the short-run and long-run aggregate-supply curves.

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Question 13

Illustrate the classical analysis of growth and inflation with aggregate demand and long-run aggregate supply curves.

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Question 14

Suppose speculators lost confidence in foreign economies and bought more U.S.bonds.How would this affect net exports in the U.S. ,and which way would this cause the aggregate demand curve to shift?

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Question 15

Other things the same,what happens to the price level and quantity of output when an adverse shift in the short run aggregate supply curve occurs?

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Question 16

In the aggregate demand and aggregate supply model,the point where the aggregate demand curve crosses the long run aggregate supply curve,and the expected price level equals the actual price level,is known as what?

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Question 17

Suppose a boom in stock market prices helps make people feel wealthier.Using the model of aggregate demand and aggregate supply,identify the curves that are affected,and which way these curves would shift.

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Question 18

Who is credited for the original development of the model of aggregate demand and aggregate supply?

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Question 19

Make a list of things that would shift the long-run aggregate supply curve to the right.

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Question 20

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Exam 20: Aggregate Demand and Aggregate Supply: Part A

The exchange-rate effect helps explain what feature in the aggregate demand and aggregate supply model?

Explain how a recession differs from a depression.

Figure 33-12. -Refer to Figure 33-12.Explain how the aggregate demand and aggregate supply model changed during periods 1 and 2.

Figure 33-13. -Refer to Figure 33-13.Identify the price and output levels consistent with long-run equilibrium.

Figure 33-16. -Refer to Figure 33-16.Suppose the economy starts at P3 and Y2.If there is a decrease in government purchases,identify the price and output levels that the economy would move to in the short run.

Misperceptions theory helps explain what feature of the aggregate demand and aggregate supply model?

Other things the same,what happens in the short run to the price level and quantity of output when the aggregate demand curve shifts to the left?

Suppose the expected price level increases.Which curves in the aggregate demand and aggregate supply model would be affected,and which way would they shift?

What variables besides real GDP tend to decline during recessions? Given the definition of real GDP,argue that declines in these variables are to be expected.

During periods of stagflation,what happens to output and prices in the economy?

Other things the same,what happens in the long run to the price level and quantity of output after a contraction in aggregate demand?

Make a list of expenditures whose sum equals GDP.

Explain how a change in the expected price level would shift the short-run and long-run aggregate-supply curves.

Illustrate the classical analysis of growth and inflation with aggregate demand and long-run aggregate supply curves.

Suppose speculators lost confidence in foreign economies and bought more U.S.bonds.How would this affect net exports in the U.S. ,and which way would this cause the aggregate demand curve to shift?

Other things the same,what happens to the price level and quantity of output when an adverse shift in the short run aggregate supply curve occurs?

In the aggregate demand and aggregate supply model,the point where the aggregate demand curve crosses the long run aggregate supply curve,and the expected price level equals the actual price level,is known as what?

Suppose a boom in stock market prices helps make people feel wealthier.Using the model of aggregate demand and aggregate supply,identify the curves that are affected,and which way these curves would shift.

Who is credited for the original development of the model of aggregate demand and aggregate supply?

Make a list of things that would shift the long-run aggregate supply curve to the right.

Ten Principles of Economics

Ten Principles of Economics: How People Make Decisions

Ten Principles of Economics: How People Interact

Ten Principles of Economics: How the Economy As a Whole Works

Ten Principles of Economics: Part A

Ten Principles of Economics: Part B

Thinking Like an Economist

Thinking Like an Economist: The Economist As Scientist

Thinking Like an Economist: The Economist As Policy Adviser

Thinking Like an Economist: Why Economists Disagree

Thinking Like an Economist: Lets Get Going

Thinking Like an Economist: Graphing a Brief Review

Thinking Like an Economist: Part A

Thinking Like an Economist: Part B

Interdependence and the Gains From Trade

Interdependence and the Gains From Trade: A Parable for the Modern Economy

Interdependence and the Gains From Trade: Comparative Advantage the Driving Force of Specialization

Interdependence and the Gains From Trade: Applications of Comparative Advantage

Interdependence and the Gains From Trade: Conclusion

Interdependence and the Gains From Trade: Part A

Interdependence and the Gains From Trade: Part B

The Market Forces of Supply and Demand

The Market Forces of Supply and Demand:Markets and Competition

The Market Forces of Supply and Demand: Demand

The Market Forces of Supply and Demand: Supply

The Market Forces of Supply and Demand: Supply and Demand Together

The Market Forces of Supply and DemandConclusion How Prices Allocate Resources

The Market Forces of Supply and Demand: Part A

The Market Forces of Supply and Demand: Part B

Elasticity and Its Applications

Elasticity and Its Applications: The Elasticity of Demand

Elasticity and Its Applications: The Elasticity of Supply

Elasticity and Its Applications: Three Applications of Supply,demand,and Elasticity

Elasticity and Its Applications: Part A

Elasticity and Its Applications: Part B

Supply Demand and Government Policies

Supply Demand and Government Policies: Controls on Prices

Supply Demand and Government Policies: Taxes

Supply Demand and Government Policies: Part A

Supply Demand and Government Policies: Part B

Consumers Producers and the Efficiency of Markets

Consumers Producers and the Efficiency of Markets: Consumer Surplus

Consumers Producers and the Efficiency of Markets: Producer Surplus

Consumers Producers and the Efficiency of Markets: Market Efficiency

Consumers Producers and the Efficiency of Markets: Conclusion Market Efficiency and Market Failure

Consumers Producers and the Efficiency of Markets: Part A

Consumers Producers and the Efficiency of Markets: Part B

Application the Cost of Taxation

Application the Cost of Taxation: The Deadweight Loss of Taxation

Application the Cost of Taxation: The Determinants of the Deadweight Loss

Application the Cost of Taxation: Deadweight Loss and Tax Revenue As Taxes Vary

Application the Cost of Taxation: Conclusion

Application the Cost of Taxation: Part A

Application the Cost of Taxation: Part B

Application International Trade

Application International Trade: The Determinants of Trade

Application International Trade: The Winners and Losers From Trade

Application International Trade: The Arguments for Restricting Trade

Application International Trade: Conclusion

Figure 33-16. -Refer to Figure 33-16.Suppose the economy starts at P₃ and Y₂.If there is a decrease in government purchases,identify the price and output levels that the economy would move to in the short run.