Question: a. If the changes in inventories in the second quarter of 2011 were mainly planned changes, what role did they play in shifting the AE

a. If the changes in inventories in the second quarter of 2011 were mainly planned changes, what role did they play in shifting the AE curve and changing equilibrium expenditure? Use a two-part figure (similar to that on p. 654 to answer this question.
b. What do you predict will happen to unplanned inventory changes if exports and investment increase and real GDP returns to potential GDP?

Step by Step Solution

★★★★★

3.45 Rating (161 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

a Figure 279 shows equilibrium expenditure Figure 2710 shows unplanned inventory change When aggrega... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

698-B-E-M-E (5292).docx

120 KBs Word File

Students Have Also Explored These Related Economics Questions!

Comprehensive variance analysis. Sol Electronics, a fast-growing electronic device producer, uses a standard costing system, with standards set at the beginning of each year. In the second quarter of...

These statements cant be right, said Ben Yoder, president of Rayco, Inc. Our sales in the second quarter were up by 25% over the first quarter, yet these income statements show a precipitous drop in...

John Ovard, president of Mylar, Inc., was looking forward to receiving the company's second quarter income statement. He knew that the sales budget of 20,000 units sold had been met during the second...

14. Study Reading Between the Lines on pp. 668669 and then answer the following questions: a. If the 2008 third quarter changes in inventories were mainly of planned changes, what role did they play...

After you have studied Reading Between the Lines on pp. 690691 answer the following questions. a. If the 2010 changes in inventories were mainly planned changes, what role did they play in shifting...

37. After you have studied Reading Between the Lines on pp. 284285 answer the following questions. a. If the 2010 changes in inventories were mainly planned changes, what role did they play in...

After you have studied Economics in the News on pp. 286287, answer the following questions. a. If the second quarter 2017 change in inventories was a planned change, what role did it play in shifting...

London School of Science & Technology Qualification Unit number and title BTEC Level 5 HND Diploma Business UNIT 6: Business Decision Making Student name and ID number Assessor name Al Hassan Barrie...

Do you agree with the changes Johnson is making to the pricing scheme that are set to take effect August 1st? Are they enough to turn things around? ELIE OFEK JILL AVERY For the exclusive use of T....

Body: This section will provide a brief evaluation of the profitability, liquidity, asset efficiency and gearing of the company. Reflect on the group discussions to assist in your analysis. Due to...

Mini-Gym Company manufactures and sells outdoor play equipment. Mini-Gym uses activity-based costing to determine the cost of the sales order processing and the customer return activity. The sales...

Pitino acquired 90 percent of Brey's outstanding shares on January 1, 2019, in exchange for $360,000 in cash. The subsidiary's stockholders' equity accounts totaled $344,000, and the noncontrolling...

A week ago, a euro ( ) cost $ 1 . 1 3 . Today, a euro costs $ 1 . 2 2 . A week ago, a British pound ( ) cost $ 1 . 4 . Today, a pound costs $ 1 . 4 6 . Attempt 1 / 1 0 for 1 0 pts . Part 1 What was...

What was the quantity of money in Canada?

Why are the benefits of reducing inflation permanent and the costs temporary? Why are the costs of increasing inflation permanent and the benefits temporary? Use Phillips-curve diagrams in your answer

Suppose the federal government cuts taxes and increases spending, raising the budget deficit to 12 percent of GDP. If nominal GDP is rising 5 percent per year, are such budget deficits sustainable...

Explain how each of the following policies redistributes income across generations. Is the redistribution from young to old or from old to young? a. An increase in the budget deficit b. More generous...

2. (6 pts) A major piece of your company's manufacturing equipment has failed and you need to buy a replacement. There are three alternatives. Which one should be selected based on rate of return...

Chapter 5 Assignment Seved 9 Your landscaping company can lease a truck for $7,300 a year (paid at year-end) for 5 years. It can instead buy the truck for $32,000. The truck will be valueless after 5...

Suppose that you are flipping 5 biased coins independently from one another. Theprobability of a coin landing HEAD is 0.6, and the probability of a coin landing TAILis 0.4. (a) What is the...