Question

Starting from long-run equilibrium, use the basic aggregate demand and aggregate supply diagram to show what happens in both the long run and the short run when there is a decline in wealth.

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Starting from long-run equilibrium, use the basic aggregate
demand and aggregate supply diagram to show what happens in both
the long run and the short run when there is an increase in wealth.
(10 points)

Suppose the aggregate demand and the short-run aggregate supply
of a country INCREASES.
a) Starting from a long-run equilibrium, use an AD-AS diagram
illustrate the effects of these two changes. Label the initial
long-run equilibrium as point A and the resulting short-run
equilibrium as point B.
b) Suppose policymakers adopt contractionary macroeconomic
policies to restore the long run equilibrium. On the same diagram
from part a, show the resulting impact on AD or AS curve and label
the new long-run...

Starting from long-run equilibrium, draw an aggregate
demand-aggregate supply graph to illustrate the difference between
a long-run and a short-run equilibrium due to an increase in
aggregate demand. Once the economy is in the short-run equilibrium,
explain and graphically illustrate how long-run equilibrium will be
restored.

Draw a basic short run aggregate supply (SRAS), aggregate demand
(AD) and long-run aggregate supply curve (LRAS) that shows the
economy in long-run equilibrium.

Using the Aggregate Demand-Aggregate Supply graphical analysis,
show what happens in the short and long-run if the exchange rate
appreciates. What happens to NX (exports-imports)? Start your
analysis in Long Run equilibrium and label this point A. Describe
the adjustment back to the Long Run equilibrium.

Please, draw Aggregate Demand, Short Run Aggregate Supply, and
Long Run Aggregate Supply as if an economy is in both short run and
long run equilibrium.
Now, Suppose the price of oil (an input in the production of
many goods) decreases. Can you please Show how
this will affect the model starting from (1) above. What happens to
GDP, The Price Level, and Potential Output? Is the economy in a
recessionary gap or an inflationary gap?
Also, Suppose that consumers...

A. Aggregate Demand, Aggregate Supply, and
Equilibrium
For a hypothetical economy, the aggregate-demand
(AD), short-run aggregate supply
(AS), and long-run aggregate-supply
(ASLR) schedules are as follows. The
schedules show the GDP price deflator (P) versus
real GDP (Q), with Q measured in
billions of constant dollars.
P
AD
AS
ASLR
80
30
22
30
90
28
24
30
100
26
26
30
110
24
28
30
120
22
30
30
130
20
32
30
A1. GRAPHS: Graph the AD,
AS,...

Show on graph (using the aggregate demand and aggregate supply
model) the effects of: A decrease in aggregate demand/recession
(show what happens both in the short run and in the long run and
make sure you explain your results)

Suppose that a sudden increase in aggregate demand moves the
economy from its long-run equilibrium. (a) Illustrate this change
using the aggregate demand-aggregate supply model. (b) What are the
effects of this change in the short run and the long run?

Potential output is equal to
A- long-run aggregate supply.
B-long run aggregate demand.
C-short-run aggregate supply.
D-short-run aggregate demand.

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