Question
3-) a-) Please draw and analyze what will happen when actual output is higher than the...
3-)
a-) Please draw and analyze what will happen when actual output is higher than the potential output.
b-) Please draw and analyze what will happen when actual output is lower than the potential output.
Homework Answers
Answer #1
3a)
when actual output is greator than potential output then there will be a positive output gap '
actual gdp will be greator then potential some resources are used beyond their capacity (labour working over time )
which will lead to a demand-pull and cost-push inflationary pressures.
3b)when actual output is lower than potential output then there will be a negative output gap.
.In negative output gap actual GDP is less than potential GDP .Some factor of production are under-utilized.there might be a problem of higher unemployment and possible deflationary risk.
In the diagram AS=aggreagte supply
AD=aggregate demand
LAS=long run aggregate supply
Not the answer you're looking for?
Similar Questions
What would happen to a corporation stock if its actual return on investment was higher than...
What would happen to a corporation stock if its actual return
on investment was higher than its Weighted Average Cost of Capital?
And what would happen to its stock if ROI was consistently lower
than its WACC?
1-For a turbine, the isentropic work output is always greater than the actual work output A...
1-For a turbine, the isentropic work output is always greater
than the actual work output
A True
B False
2-For a compressor, the isentropic work input is always greater
than the actual work output
A True
B False
3-Ignoring kinetic and potential energy, and for a steady state
process with one inlet and one outlet, the internally reversible
work can be given as:
A ∫12pdv
B ∫12vdp
The Phillips curve shows that: a- Inflation is usually higher than expected when actual equilibrium GDP...
The Phillips curve shows that:
a- Inflation is usually higher than expected when actual
equilibrium GDP is greater than potential GDP
b- Changes in labor demand tend to be deflationary
c- As unemployment rises, the general price level is rising
d- Technological improvements might increase the level of
noncyclical unemployment
When the economy is in a short-run equilibrium, with output greater than potential GDP, the short-run...
When the economy is in a short-run equilibrium, with output
greater than potential GDP, the short-run aggregate supply curve
will shift to the left. Why would this happen?
With output above potential GDP, the economy produces too many
goods and those goods are sold at prices that are too high.
This happens only after government interference.
With output above potential GDP, wages will be bid up and the
expected price level will rise from the increase in the actual
price...
If actual GDP > Potential GDP are we in boom (expansion) or bust (recession)? If actual...
If actual GDP > Potential GDP are we in boom (expansion) or
bust (recession)?
If actual GDP > potential GDP is unemployment higher than
NAROU or lower?
What is the danger of actual GDP > potential GDP?
a. Draw a molecular-level and macroscopic picture of what will happen when you put a Bromocresol...
a. Draw a molecular-level and macroscopic picture of what will
happen when you put a Bromocresol Green (BCG) solution into a
dialysis tube and then place the tube in a buffer solution.
What will you observe at the
beginning of the experiment?
b. Draw a molecular-level and macroscopic picture of what will
happen when you put a Bromocresol Green and albumin solution into a
dialysis tube and then place the tube in a buffer solution.
Okun's law shows that when the unemployment rate is below the natural rate, A. inflation is...
Okun's law shows that when the unemployment rate is
below the natural rate,
A.
inflation is higher than expected.
B.
inflation is lower than expected.
.
C.
output is below potential.
D.
output is above potential
Constant returns to scale implies that if N and K both increase
by 3% that
A.
Output (Y) will increase by 3%.
B.
Y/N will increase by 3%.
C.
Y/N will increase by less than 3%.
D.
the capital-labor ratio will increase by 3%....
Everything else held constant, when actual output exceeds potential output ________ aggregate supply ________. long-run; increases...
Everything else held constant, when actual output exceeds
potential output ________ aggregate supply ________.
long-run; increases
long-run; decreases
short-run; increases
in 2015 the capital-output ratio is higher in country C than in country D and both...
in 2015 the capital-output ratio is higher in country C than in
country D and both countries are in steady state. Possible reasons
include:
a) country C has higher saving rate than country D
b) country C has higher productivity growth than country D
c) country C has lower productivity growth than country D
d) both a) and b)
e) both a) and c)
stagflation- lower output and higher price. is caused by what
stagflation- lower output and higher price. is caused by what
ADVERTISEMENT
Need Online Homework Help?
Get Answers For Free
Most questions answered within 1 hours.
ADVERTISEMENT
Active Questions
asked 2 minutes ago
asked 15 minutes ago
asked 17 minutes ago
asked 22 minutes ago
asked 26 minutes ago
asked 35 minutes ago
asked 41 minutes ago
asked 46 minutes ago
asked 47 minutes ago
asked 54 minutes ago
asked 1 hour ago
asked 1 hour ago