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Using the aggregate demand-aggregate supply (short-run) model, explain the impact of the public's expectations of severe inflation on real GDP and the price level.

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Increased expectations of severe inflati...

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How is the long-run aggregate supply curve sloped? Explain.

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The long-run aggregate supply curve is f...

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What are five reasons for the downward price-level inflexibility, especially as it pertains to wages and prices?

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First, wage contracts will fix wages for...

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List the three major determinants that can cause a shift in the short-run aggregate supply.

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The determinants of short-run aggregate ...

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Identify the ways in which each of the following determinants would have to change to cause a decrease in aggregate demand: consumer wealth, consumer expectations, business taxes, national income in countries abroad, exchange rates.

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To decrease aggregate demand, consumer w...

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How can the aggregate demand curve be derived from the aggregate expenditures model?

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The aggregate demand curve is derived fr...

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Describe and explain what is meant by the ratchet effect.

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A ratchet is a good analogy for the effe...

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Using the aggregate demand-aggregate supply (short-run) model, explain how the depreciation of the Canadian dollar in terms of foreign currencies would affect the economy.

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The depreciation of the Canadian dollar ...

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Describe the change in short-run aggregate supply that should result from each of the following changes in determinants.Assume that nothing else is changing besides the identified change.(Use "Decrease" or "Increase.") (a) A rise in the average price of inputs; (b) An increase in worker productivity; (c) Government antipollution regulations become stricter; (d) A new subsidy program is enacted for new business investment in productive equipment; (e) Energy prices decline.

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(a) Decrease;
(b) Increase;
(c) Decrease...

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What determines the equilibrium price level and the level of real GDP in the aggregate demand-aggregate supply (short-run) model?

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The interaction of short-run aggregate s...

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How can an economy already at full-employment expand without igniting inflation? Explain.

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If the economy is currently at full-empl...

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Some economists argue that it is easier to resolve demand-pull inflation than cost-push inflation.Use the aggregate demand-aggregate supply (short-run) model to explain this assertion.

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To address demand-pull inflation, the go...

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The determinants of aggregate demand "determine" the location of the aggregate demand curve.Explain the four basic determinants of aggregate demand.

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The four basic determinants of aggregate...

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How is the immediate short-run aggregate supply curve sloped? Explain.

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The immediate short-run aggreg...

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How is the short-run aggregate supply curve sloped and why is it sloped this way?

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The short-run aggregate supply (SRAS) cu...

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