Using the aggregate demand and aggregate supply (AD-AS) diagram, explain what will happen to the equilibrium price level and Real GDP when each of the following events occurs: (i) A technological advancement in agricultural sector. (ii) The Malaysian government’s economic stimulus package of RM8 billion. (iii) An appreciation of Ringgit Malaysian (RM).
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Using the aggregate demand and
(i) A technological advancement in agricultural sector.
(ii) The Malaysian government’s economic stimulus package of RM8 billion.
(iii) An appreciation of Ringgit Malaysian (RM).
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- Using the aggregate demand and aggregate supply (AD-AS) diagram, explain what will happen to the equilibrium price level and Real GDP when each of the following events occurs: 3. (i) A technological advancement in agricultural sector. (ii) The Malaysian government's economic stimulus package of RM8 billion. (ii) An appreciation of Ringgit Malaysian (RM). (iv) An increase in labour productivity. (v) An increase in wage rates. (vi) An increase in higher educated labour force. (vii) Households expected lower future prices. (viii) An adverse supply shock.Using the aggregate demand and aggregate supply model, explain the effects of the following on price and real income in Malaysia.Use the Aggregate supply and Aggregate Demand Model below to answer the questions that follow. Aggregate Supply and Aggregate Demand Model(i) Examine the influence of government expenditure on investment in a nation. Use Jot Inc. Ltd a multinational construction company in which you are the Chief Exec of the firm that that is highly diversified and recieves funds to construct highways and other government funded projects. Also, explain the factors that cause the Aggregate Demand curve to be downward sloping left to right.
- The data below represents the price level, the aggregate demand, and the aggregate supply data for an economy. Use the data points to plot an aggregate demand curve and aggregate supply curve for this economy. Each curve is labeled as AS (Aggregate Supply) or AD (Aggregate Demand) and each point is labeled as a, b, or c from the table headings. (Hint: Note that point a from the AD curve is already plotted with the correct coordinates. Plot the remaining points.) Provide your answer below: Price Level -100 200 180 160- 140- 120 AS: a ($140,100) AS: b ($300, 100) AS: c ($500,100) 100- -80 -60 40 20 0 -20 AD: c ($100,80) 100 Price Level Aggregate Supply (AS) Aggregate Demand (AD) 200 AD: b ($300,80) AD: a ($390,80) 300 400 600 500 Real GDP ($) a b 120 80 $320 $420 $390 $340 C 170 $540 $280Use an aggregate supply (upsloping range) and aggregate demand diagram to demonstrate the effect of each of the following. For each problem state the determinant and what happens to the price level and RGDP. Consumer confidence grows for third straight month. A technological breakthrough lowers the cost of energy. The government engages in a new highway building program. A series of natural disasters disrupt production and delivery of goods. Laws are tightened to make immigration more difficult and this leads to labor shortages. Interest falls. Productivity rises. Labor strikes cause an interruption in shipments of parts. Increased graduation rates for schools lead to more-skilled workforce. Stock and bonds markets soarWhich of the following would increase aggregate demand? A) Increase in taxation. B) Increase in savings. C) Decrease in consumption spending. D) Increase in government spending.
- Determinants of aggregate demand The following graph shows a decrease in aggregate demand (AD) in a hypothetical country. Specifically, aggregate demand shifts to the left from AD1AD1 to AD2AD2, causing the quantity of output demanded to fall at all price levels. For example, at a price level of 140, output is now $200 billion, where previously it was $300 billion.The graph below is associated with a hypothetical country. Consider an increase in aggregate demand (AD). Specifically, aggregate demand shifts to the right from AD1AD1 to AD2AD2, causing the quantity of output demanded to rise at each price level. For instance, at a price level of 140, output is now $400 billion, where initially it was $300 billion. Fill in the missing values in the table by selecting the change in each scenario required to increase aggregate demand. Change required to increase AD Expected rate of return on investment. (decrease/increase) Incomes in other countries (decrease/increase) Consumer expectations about future profitability. (improve/worsen) Government spending (increase/decrease)Which of the following shifts the aggregate supply and the potential GDP curve to the left? a decrease in immigration a decrease in the price level a decrease in the money supply a decrease in the expected price level
- Given the following circumstances, indicate whether or not the aggregate supply curve would shift and, if so, which way would it shift: The price of a barrel of oil doubles An advance in alternative energy technology significantly reduces its cost In order to maintain a relatively clean air quality, a carbon emissions tax is levied against firms with a carbon footprint As a result of fracking, the price of natural gas is significantly reduced Advances in technology increase the productivity of the American worker, on average, by 30%Macroland is recognized as a high-income economy by the World Bank. The country of Macroland is now in a recession. Using a correctly labeled graph of the long run aggregate supply, short run aggregate supply, and aggregate demand curves and show each of the following: Current price level, labeled PL1 Current output, labelled Y1 Assume that Braveland, a major trading partner of Macroland, enters into a recession. Explain the effect on Macroland exports to Braveland On your graph in part (a) above, show the effect of the change identified in part (b) (i) above on real output in Macroland. How would this change in real output in Macroland affect unemployment in Macroland? Assume the recession in Braveland causes a decrease in the demand for Macroland dollars in the foreign exchange market. Braveland’s currency is the euro. Explain whether the euro will appreciate, depreciate, or remain…Macroland is recognized as a high-income economy by the World Bank. The country of Macroland is now in a recession. Using a correctly labeled graph of the long run aggregate supply, short run aggregate supply, and aggregate demand curves and show each of the following: Current price level, labeled PL1 Current output, labelled Y1 Assume that Braveland, a major trading partner of Macroland, enters into a recession. Explain the effect on Macroland exports to Braveland On your graph in part (a) above, show the effect of the change identified in part (b) (i) above on real output in Macroland. How would this change in real output in Macroland affect unemployment in Macroland? Assume the recession in Braveland causes a decrease in the demand for Macroland dollars in the foreign exchange market. Braveland’s currency is the euro. Explain whether the euro will appreciate, depreciate, or remain…