Khan Academy
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Khan Academy
Khan Academy
Let's look at the concept of equilibrium in macroeconomics, using graphs to illustrate aggregate demand and aggregate supply. See how different price levels and outputs affect the equilibrium point, and how the business cycle—characterized by expansions and recessions—reflects these changes.
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SOLVED: An economy starts out in short-run and long-run equilibrium. If both short-run and long-run aggregate supply increase, so that the economy remains in equilibrium:A. The real level of output will rise, and the nominal level will fall.B. The aggregate demand curve will have to shift.C. The real level of output will fall, and the price level will rise.D. The real level of output will rise, and the price level will fall.E. The real level of output will rise, and the price level will rise.
SOLVED: An economy starts out in short-run and long-run equilibrium. If both short-run and long-run aggregate supply increase, so that the economy remains in equilibrium:A. The real level of output will rise, and the nominal level will fall.B. The aggregate demand curve will have to shift.C. The real level of output will fall, and the price level will rise.D. The real level of output will rise, and the price level will fall.E. The real level of output will rise, and the price level will rise.
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SOLVED:Using aggregate demand, short-run aggregate supply, and long-run aggregate supply curves, explain the process by which each of the following government policies will move the economy from one long-run macroeconomic equilibrium to another. Illustrate with diagrams. In each case, what are the short-run and long-run effects on the aggregate price level and aggregate output? a. There is an increase in taxes on households. b. There is an increase in the quantity of money. c. There is an increa
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SOLVED: An economy starts out in short-run and long-run equilibrium. If both short-run and long-run aggregate supply increase, so that the economy remains in equilibrium:A. The real level of output will rise, and the nominal level will fall.B. The aggregate demand curve will have to shift.C. The real level of output will fall, and the price level will rise.D. The real level of output will rise, and the price level will fall.E. The real level of output will rise, and the price level will rise.
SOLVED: An economy starts out in short-run and long-run equilibrium…
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SOLVED:Using aggregate demand, short-run aggregate supply, and l…
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