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Unformatted text preview: moving). If the AD curve shifts, we trace out equilibrium points along the AS curve, which slopes up. Output and the price level move in the same direction. 3. The AD curve shifts to the right. Output and the price level increase. 4. The AS curve shifts left. Output falls, and the price level rises. 5. a. GDP increases by $15,000 (assuming, of course, that the carpenter reports this income to the authorities). b. GDP increases by $3,000. The productive activity of using the materials to build the garage is not counted, since this activity was not sold on an organized market. c. No effect in GDP. d. GDP increases by $150,000. e. No effect on GDP. f. GDP increases by $2000. g. No effect on GDP. h. GDP increases by $1000, the price of the plasma TV....
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This note was uploaded on 06/17/2009 for the course ECON 20091_ECO taught by Professor Mohammadsafarzadeh during the Fall '09 term at USC.
- Fall '09