I need an answer for this hard question. post your replyfor this table ad comment about each part(what is happening ), read the question carefully
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w/ shoreline community college - x Topic: Open Forum #3 X ucture.com/courses/1974435/discussion_topics/11023047 You can see when I graph this example price level went up so we experienced inflation. You can see that the new Q1 is below the Full-employment level so this means we are experiencing more unemployment. Remember at Qfe we are at our natural rate of unemployment. Additionally the price level has risen from PL1 to PL2 which means this economy also experienced inflation. AS2 AS1 PL2 PL1 AD1 Q1 Ofe PART A Which Does the Does this shift cause a # Economic Change curve curve problem of shifts? AD Increase or unemployment, or AS Decrease? inflation, neither or both? 1 Real Interest Rates Decrease 2 Substantial immigration occurs increasing labor supply 3 Citizens Pay off Debt 4 Increase by the government in Business payroll taxes PART BThere are many real world factors that cause aggregate demand and aggregate supply to shift. When an economy is operating at full employment (Of) and experiences an economic change that impacts aggregate demand or aggregate supply then a new equilibrium occurs which causes either inflation, unemployment, neither or both. Factors that Shift Aggregate Demand Investment Consumer Spending Government Spending Net Export Spending Spending Real Interest Rate Expected Returns Wealth Expectations of the Increase spending Public Borrowing future goods National Incomes Abroad Consumer Expectations Technology Decrease spending public Exchange rates Personal Taxes Excess Capacity goods increases/decreases Business Taxes Factors that Shift Aggregate Supply AS Shifters Change in Legal-Institutional Change in Input Prices Change in Productivity Environment Domestic Resource Prices Capital, Education, Technology Business Tax Subsidies Prices of imported Resources Government Regulations Using the table of information below, start each # scenario at equilibrium and full employment (Qf), determine what curve shifts and which direction and the economic impact.Factors that Shift Aggregate Supply AS Shifters Change in Input Prices Change in Legal-Institutional Environment Domestic Resource Prices Change in Productivity Capital, Education, Technology Business Tax Subsidies Prices of imported Resources Government Regulations Using the table of information below, start each # scenario at equilibrium and full employment (Qf), determine what curve shifts and which direction and the economic impact. The best way to attack this dicussion is to draw AS and AD at full employment and locate the equilibrium which will tell you the price level and GDP quantity and label them as PL1 and Qfe. This should be your full-employment starting point for each scenario. Remember at Full-employment an economy only experiences the natural rate of unemployment and price stability. Next, read the scenario and determine if AD or AD shifts and draw the new curve and find the new equilibrium and find the new price level and GDP quantity and label them PL2 and PL2. Now look at the y-axis and determine if price level increased or decreased on the y-axis between PL1 in relation to PL2. If it increased the inflation occurred. Then determine if GDP quantity increased or decreased on the x-axis in terms of Qfe in relation to Q1. If your Q1 quantity is to the left Ofe then unemployment occurs. If the Q1 is to the right of Qfe then no unemployment occurs. (I recommend watching the Chapter 12 videos - AD and AS practice). Here are is an example on how to go about completing each item. If Labor supply decreases that is an AS change as there are less workers and producers can supply less. Remember AD only shifts if its consumption, investment, government spending or imports/exports. You can see when I graph this example price level went up so we experienced inflation. You can see that the new Q1 is below the Full-employment level so this means we are experiencing more unemployment. Remember at Qfe we are at our natural rate of unemployment. Additionally the price level has risen from PL1 to PL2 which means this economy also experienced inflation
