Answer to Question #122446 in Macroeconomics for Aral

Question

PLEASE YOU SHOULD SOLVE IT QUICKLY Aggregate demand and aggregate supply schedules in Burgazistan are given as follows:

Price level Real GDP demanded Real GDP supplied in the short run
75 600 400
85 550 450
95 500 500
105 450 550
115 400 600
125 350 650
135 300 700

a) What is the short-run macroeconomic equilibrium GDP level? (5 pts)


b) What is the equilibrium price level? (5 pts)


Suppose that the initial equilibrium you found in “a” is at the long run aggregate supply curve and the economy receives a negative demand shock which decreases aggregate demand by 100 at each price level.

c) What is the new short-run macroeconomic equilibrium GDP level? (5 pts)


d) What is the output gap? (5 pts)


e) In the long-run the economy adjusts to the long-run equilibrium point.
What is long-run equilibrium GDP level? (5 pts)

Answer 1

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