The graphs illustrate an initial equilibrium for the economy. Suppose that the government cuts taxes.
Use the graphs to show the new positions of aggregate demand (AD), short‑run aggregate supply (SRAS), and long‑run aggregate supply (LRAS) in both the short run and the long run, as well as the short‑run and long‑run equilibriums resulting from this change. Then, indicate what happens to the price level and real GDP (or aggregate output) in the short run and in the long run.
In the short-run, the price level __________ and GDP __________.
In the long-run, the price level __________ and GDP __________.
WORD BANK
increases
decreases
stays the same
Answers
Answer:
In the short-run, the price level increases and GDP increases.
In the long-run, the price level increases and GDP stays the same.
Explanation:
When the government cuts taxes, consumers have more disposable income and increase spending. This shifts the AD curve to the right.
Short run: Neither the SRAS nor LRAS curves shift in the short run in response to the increase in aggregate demand. The new equilibrium point is the intersection of the shifted AD curve with the SRAS curve.
Long run: The aggregate demand increase looks the same on the long‑run graph as it does on the short‑run graph. As the higher price level causes expectations to change, the SRAS curve then shifts such that it intersects the AD and LRAS curves at the same point. As was the case in the short run, the LRAS curve itself does not move, as it only shifts when the economy's potential output changes due to factors like technological progress.
The long‑run equilibrium point is then the intersection of AD, SRAS, and LRAS.
The graphs show the economy's initial equilibrium. Let's say the government lowers taxes. The price level and GDP both rise in the short term. In the long run, prices rise but GDP stays constant.
What is government?The term government refers that the system which was governed by a state or a country in it, we see there are different governments are being there in states the government is made by the people and govern for the people also in it. There is a system being made and under the system, the government is being run.
When taxes are reduced by the government, customers have more money to spend. The AD curve is moved to the right as a result. Short run: In the short term, the increase in aggregate demand has no effect on either the SRAS or LRAS curves
Therefore, The graphs show the economy's initial equilibrium. Let's say the government lowers taxes
Learn more about the government here:
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Related Questions
PLS ANSWER ALL, THANK YOU!
In the blank at the left, write the letter of the choice that best completes the statement or answers
the question.
7 Points
___ 1. To avoid the concentration of power, the states divided government functions between the
_?_.
A. people and the governor
B. people and legislature
C. governor and the president
D. governor and the legislature
Continue on next page.
___ 2. Under most state constitutions, which government branch was most powerful?
A. the judicial branch
B. the legislative branch
C. the executive branch
D. none
___ 3. Which of these functions could the national government not perform under the Articles of
Confederation?
A. conduct foreign affairs
B. impose taxes
C. maintain armed forces
D. issue currency
___ 4. How many states had to approve the Articles of Confederation?
A. 13
B. 9
C. 11
D. 10
___ 5. What area did the ordinance passed in 1787 create?
A. Mississippi River valley
B. Appalachia
C. Northwest Territory
D. Ohio River valley
___ 6. When could a territory apply for statehood?
A. when it abolished slavery
B. when it elected a governor
C. when it wrote a constitution
D. when its population reached 60,000
___ 7. How did Robert Morris propose to pay off the national debt left over from fighting the
Revolutionary War?
A. 5 percent state sales tax
B. 5 percent import tax
C. 5 percent national income tax
D. 10 percent inflation tax
Answers
1.D.
2.C.
3.C.
4.D.
5.D.
6.B.
7.C.
Explanation:
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Investors face various choices regarding what they can invest in, and the choices carry varying amounts of risk. For example, stock prices are much more volatile than bond prices.
What is the typical reason why investors would choose to put their money into an investment with higher risk rather than one with lower risk?
- They want to signal their courage to other investors and scare them away.
- Assuming enough risk in a portfolio qualifies investors for a large government tax credit.
- Riskier investments typically have higher returns.
- Riskier investments are insured by the FDIC.
- They are irrational or are thrill‑seekers.
Answers
Answer:
Riskier investments typically have higher returns.
Explanation:
Although investors choose investments for many different reasons, most investors are seeking to earn a return. Ideally, they would like to earn a high return while exposing themselves to little risk, but what typically happens is that companies offering investments with higher risk know that they have to compensate investors for assuming that risk, or else they will not attract sufficient investment. Thus, higher‑risk investments typically offer a higher return, whereas companies offering lower‑risk investments know that they can offer a lower return and still attact investment. For example, a small company in a competitive, fast‑changing industry will typically offer to pay a higher interest rate for its corporate bonds than a large company in a stable industry.
Also, advertising using risque outfits seem to be more aimed at consumers than investors. Advertising for investors is typically rather boring, featuring graphs and numbers. Of course, one may find that the most interesting models of all are economic models. According to the risk-return tradeoff theory, higher risk is associated with greater probability of higher return and lower risk associated with a greater probability of lower return. The trade-off which the investor faces between risk and return while considering investment decision is called risk return trade-off.
What is one way political parties shape public policy?
Answers
Answer:
"Helping elected officials who belong to the party work together more effectively."
Explanation:
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Which of the following was a Roman contribution to art? (1 point)
a
marble sculpture
b
oil painting
c
portrait painting
d
mosaics
Answers
Answer:
A: A marble sculpture!!!
Explanation:
I hope this helps you! :)
Answer:
D) mosaics
Explanation:
And this is the right answer.
The first person is wrong.
And I do the pretest right now.
I hope have a nice day :)
If Northland has a debt of $5 million in 2014, and runs a deficit of $0.3 million in 2015, and a surplus of $0.4 million in 2016, what would its debt be at the end of 2016, assuming no additional interest is added to its debt?
$5.3 million
$4.9 million
$5.7 million
$4.3 million
Answers
A $0.3 million deficit in 2015 has increased the debt from $5 to $5.3 million, and a $0.4 million surplus in 2016 has reduced the debt from $5.3 million down to $4.9 million at the end of the year.
Write down one main question you would like to ask an elected official who may be weighing in on transgender rights issues.
Answers
Answer:
why would it be ok for a transgender person to be able to joining the opposite gender sports team
Explanation:
One of the key underpinnings of public choice analysis is the assumption that politicians and bureaucrats
make political decisions based on self‑interest, just as individuals and firms do.
make political decisions based primarily on benefiting future generations.
seek only to maximize long term economic growth through increasing GDP.
act not out of self‑interest but desire to increase the general utility of the public.
Answers
Answer:
a. make political decisions based on self‑interest, just as individuals and firms do.
Explanation:
Public choice analysis is the combination of political science and economics and analyzes political decision making. One key assumption of public choice theory is that politicians are rational, self‑interested, economic agents. Like all other economic agents, they make decisions based on their own self‑interest (specifically, to satisfy constituents and retain their positions). It leads to rise of interest groups, logrolling and rent seeking behavior from the politicians and bureaucrats which leads to inefficiency.
What is one way that American citizens can defend the United States from national security threats?
A.
participating in jury duty
B.
voting in elections
C.
joining the armed forces
D.
keeping current on issues
Answers
Question 1 (1 point)
What is nationalism? (2 poin
Answers
Answer:
Nationalism is an idea and movement that holds that the nation should be congruent with the state. As a movement, nationalism tends to promote the interests of a particular nation, especially with the aim of gaining and maintaining the nation's sovereignty over its homeland to create a nation state.
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the purpose of law of education
Answers
Which of these documents is created by each state? ASAP
Constitution
Declaration of Independence
Articles of Confederation
State of the Union
Answers
The documents created by each state is the Constitution as it contains all of the governing principles of the state.
The Constitution: as a guide for governanceA constitution by definition is an aggregate of fundamental principles or established precedents that constitute the legal basis of a polity, organisation or other type of entity and commonly determines how such entity in discuss is to be governed.
Read more on Constitution;
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Though accurate, it is inconvenient and impractical to follow local time in a place .Write clearly to prove the claim.
Answers
Answer:
Because the Earth rotates at an uneven speed, solar days vary slightly in size. This indicates that the pace of true solar time is not constant. Mean solar time is calculated based on the 24 hour length of a mean solar day. It moves at a constant speed. It would be a disadvantage to follow
Outline some of the issues facing women in the twenty-first century
Answers
Answer:
Women did not have the right to vote and were seen as less than equal to male. Women did not have real jobs or own anything to themselves. Instead, they stayed home and cooked, cleaned, and took care of kids.
Explanation:
What is the primary responsibility of congressional committees?
Answers
Answer:
Committees monitor on-going governmental operations, identify issues suitable for legislative review, gather and evaluate information, and recommend courses of action to the Senate.
Explanation:
there ya go
. _____________________ waves are used to send signals because they can travel over very long distances and pass through buildings
Answers
Answer:
the answer is electromagnet
Explanation:
Answer:
__________ waves are used to send signals because they can travel over very long distances and pass through buildings.
Explanation:
Radio is your answer.
radio waves are used to send signals because they can travel over very long distances and pass through buildings.
what are the advantages of sheep and goat farming
Answers
Hi!the advantages of sheep and goat farming is that Sheep and goats make very effective use of a variety of different grazing lands, including rocky mountain terrain and alpine pastures, which cannot be utilized by other domestic animals. They convert relatively inaccessible low quality forage to high quality meat, wool and fibre.
True or False: The Bible provides truth in theological and spiritual areas, but not in scientific and historical areas.
Answers
Answer:
True
Explanation:
This is true because it is not a scholarly source, as more people would think it is a primary source.
Use the table to answer the questions. Round your answers to the nearest cent.
What is the GDP per person (per capita) for country A?
What is the GDP per person for country B?
Which country has the largest average GDP per person?
- country A
- country B
Answers
Answer:
Country A = $20,000
Country B = $25,000
Country B
Explanation:
GDP per capita for country A = 7 trillion / 350 million = 20000
Country A = $20,000
GDP per capita for country B = 1.25 trillion / 50 million = 25000
Country B = $25,000
Since 20 million < 25 million
Country B has largest average GDP per year.
GDP per person can be thought of as the average output produced by each individual in a country. The country with the larger average GDP per person is country B. Notice that the country with the largest GDP does not necessarily also have the largest average GDP, because populations differ.
POEM COMPOSITION: Population - a group of organisms of the same species that live in a certain area. Carrying capacity can be defined as species’ average population size in a particular habitat. The species population size is limited by environmental factors like adequate food, shelter, water, and mates. If these needs are not met, the population will decrease until the resource rebounds.
Construct or compose a poem about the relationship between population and carrying capacity.
• Written in a short bond paper with margin on both sides.
• Must be presentable
• Submitted on time
• Your grades will be based using the rubric provided.
Answers
Why fundamental attribution error is important?
Answers
Answer: Understanding the fundamental attribution error is important because research shows that everyday human behavior is heavily influenced by external factors, yet when evaluating others' behavior, you may wrongly perceive their actions as stemming from internal factors
Explanation: Fundamental attribution error breaks collaboration, renders communication ineffective and can even make people leave the organisation. It can cost someone their job.
Define is peace building
Answers
Answer:
Peacebuilding is an activity that aims to resolve injustice in nonviolent ways and to transform the cultural and structural conditions that generate deadly or destructive conflict.
Mao Zedong wanted to make China ___________.
a: a democracy
b: a communist nation
c: a colony of Great Britain
d: very poor
Answers
Suppose that because of globally adverse meteorological conditions, there are serious concerns of climbing prices in an extensive group of commodities. As a result, people now expect an acute increase in the level of input prices. The figure shows aggregate demand (AD), short‑run aggregate supply (SRAS), and long‑run aggregate supply (LRAS). Move one or more of these curves to describe the short‑run effect this would have in the economy and answer the two questions.
*graph goes here*
In the short run, price level
a. decreases.
b. The change is indeterminate.
c. increases.
2. In the short run, real GDP (or aggregate output)
a. increases.
b. The change is indeterminate.
c. decreases.
Answers
Answer:
From the graph above it can be observed that, in the short run price level increases and real GDP decreases.
Explanation:
Input prices are expected to be high and firms' costs are expected to increase. Thus, for any given actual price level, this reduces the quantity of goods and services that firms will supply, which means the short‑run aggregate supply curve shifts to the left (changes in expectations of prices shift the SRAS). This causes the price level to increase and real GDP to decrease.
The increase in expectation of input prices does not change the economy's level of technology or overall productivity. Because of this, an increase in the input price does not change the long‑run aggregate supply. The LRAS curve indicates the amount of goods that the economy could produce if the economy was at full employment.
Likewise, an increase in expectation of input prices does not affect the overall level of demand, so aggregate demand does not shift. Changes in consumption, investment, government spending, and net exports, or C, I, G, and NX, affect AD.
Reading the graph shows that the price level increases and real GDP decreases in the short run. However, this results in higher unemployment, reducing input costs. So in the long run, this causes SRAS to shift back to the right, according to this AD/AS model.
Real GDP per capita is NOT an adequate measure of
average real GDP per person in the economy.
the well-being of each person in an economy.
a country's average aggregate spending per person.
a country's average aggregate output per person.
Answers
Answer:
the well-being of each person in an economy.
Explanation:
Real GDP per capita is average real GDP per person in the economy. It can be found by dividing real GDP by population. It is a measure of the economy's aggregate output per person which is also a measure of aggregate spending per person.
Richer nations with higher real GDP per capita are typically happier than poorer nations. However, real GDP per capita is a poor measure of the overall well-being of individuals in an economy because real GDP per capita does not measure the many dimensions related to how people live, but rather how much, on average, individuals in a country produce and consume.
Real GDP per capita measures the average level of a country's income, adjusted for inflation. Since, It tracks the average real GDP per person in the economy, option (a) is not valid. Real GDP per capita can also be used as a rough estimate of a country's average aggregate output per person as well as the average spending capacity per person of a country. Therefore, options (c) and (d) are not correct either. The emotional or general well-being of a country's populace is not accounted for in the data used to calculate the Real GDP per capita of a country.
Adjust the graph to show the effect of a decrease in the aggregate price level.
Which of the statements offers the best explanation for the change demonstrated in the graph?
a. Prices of goods and services decrease on average.
b. The prices of a few goods in the market dropped substantially.
c. Consumers purchase less of one product, like cars, and more of another, like clothing.
d. The law of demand dictates the behavior of the aggregate demand curve.
Answers
Answer:
a. Prices of goods and services decrease on average.
Explanation:
Since the aggregate demand curve shows the relationship between the aggregate price level and real GDP, a reduction in the aggregate price level is represented by a movement along the aggregate demand curve. The aggregate price level is a weighted average of the prices of all of the goods in the economy.
If only the prices of a few goods fall, it is not likely to affect the aggregate price level. The law of demand does not concern the aggregate demand curve but the relationship between the price level and the various components of aggregate demand. If consumers purchase more of one product and less of another, then the overall price level will be unaffected.
features of capital budget .At least 5 points
Answers
Answer:
Big Investments Irreversible Decision MakingHigh Risk Impacts the structure costAffects Your Future Competitivenessbusiness plan for bakery
Answers
[tex] \mathbb\blue{Refer\:to\:attachments\:for\:sample}[/tex]
[tex]\mathbb\blue{of\:a\:bakery\:business\:plan} [/tex]
define and explain trade
Answers
Trade is a basic concept involving both buying and selling of goods and services. Trade helps people to buy item or sell any product.
what is the difference between myth and truth?
Answers
What we expect to see can play a bigger role when we form beliefs than what we actually see. True or false?
Answers
Answer:
true
If u believe in God
u won't Ever wonder how He created the universe
