|
Price level
(GDP deflator, 2005 = 100)
|
Quantity of
real GDP demanded (trillions of 2005
dollars)
|
Quantity of
real GDP supplied (trillions of 2005 dollars)
|
|
115
|
8.8
|
12.0
|
|
110
|
9.4
|
11.0
|
|
105
|
10.0
|
10.0
|
|
100
|
10.6
|
9.0
|
|
95
|
11.2
|
8.0
|
|
90
|
11.8
|
7.0
|
1)
Based on the table above,
a) What is the equilibrium price level and real GDP?
b) If potential GDP is $11.0 trillion, what does that imply about the
economy's level of employment?
c) If potential GDP is $9.0 trillion, what does that imply about the
economy's level of employment?
#Parkin
#11edition #AggregateSupply #AggregateDemand #Chapter27
Aggregate Supply, Aggregate Demand
Answer:
ReplyDeletea) The equilibrium price level is 105; the equilibrium real GDP is $10.0 trillion.
b) If potential GDP is $11.0 trillion, then the economy is at an equilibrium that is a below full-employment equilibrium.
c) If potential GDP is $9.0 trillion, then the economy is at an equilibrium that is an above full-employment equilibrium.