Test -6 For each of the following, illustrate and explain

the changes to AD and AS - 20 marks 10% weightage.

Draw the diagram for each.

1. .A conflict in the middle east drives energy prices up

while the government places orders for nearly $100

billion of new military equipment from American

manufacturers

2. China enters the WTO, forcing the US to reduce

tariffs on Chinese imports

3. Labor unions across the country successfully bargain

for across the board wage increases

4. .Government spending on unemployment benefits

and health care for out of work Americans is slashed

5. Improvements in technology increase households'

real incomes and improve the productivity of labor in

the country.

6. Looser immigration laws lead to an increase in the

labor force, putting downward pressure on wages.

7. Education spending by state and federal government

is reduced, which over time makes it harder for firms

to higher skilled, qualified workers

8. The US government increases its spending on

infrastructure, which increases efficiency and

reduces costs for most American businesses

9. A weakening of the value of the US dollar against

other major currencies makes American goods more

attractive to foreign consumers

10.

Lower interest rates make borrowing money for

capital investments more attractive to businesses.