Chapter 11: Q. 32 (page 292)
How is long-term growth illustrated in an AD/AS model?
Short Answer
In an AD/AS diagram, a progressive rightward shift of aggregate supply shows long-run economic growth due to productivity gains over time.
Chapter 11: Q. 32 (page 292)
How is long-term growth illustrated in an AD/AS model?
In an AD/AS diagram, a progressive rightward shift of aggregate supply shows long-run economic growth due to productivity gains over time.
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Get started for freeBriefly explain the reason for the near-vertical shape of the SRAS curve on its far right.
How would a dramatic increase in the value of the stock market shift the AD curve? What effect would the shift have on the equilibrium level of GDP and the price level?
What is the Keynesian zone of the SRAS curve? How much is the price level likely to change in the Keynesian zone?
If households decide to save a larger portion of their income, what effect would this have on the output, employment, and price level in the short run? What about the long run?
How is recession illustrated in an AD/AS model?
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