The table sets out the aggregate demand and aggregate supply schedules in Japan. Potential GDP is 600

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The table sets out the aggregate demand and aggregate supply schedules in Japan. Potential GDP is 600 trillion yen. What is the short-run macroeconomic equilibrium? Does Japan have an inflationary gap or a recessionary gap and what is its magnitude?

Price level (GDP price index) Real GDP Real GDP supplied (trillions of 2005 yen) demanded 600 75 400 85 550 450 95 500 5

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Foundations of Macroeconomics

ISBN: 978-0134492001

8th edition

Authors: Robin Bade, Michael Parkin

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Question Posted: May 21, 2018 07:45 AM

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The table sets out the aggregate demand and aggregate supply schedules in Japan. Potential GDP is 600

Question:

Price level (GDP price index) Real GDP Real GDP supplied (trillions of 2005 yen) demanded 600 75 400 85 550 450 95 500 500 105 450 550 115 400 600 125 350 650 135 300 700

Step by Step Answer:

The macroeconomic equilibrium occurs at real GDP of 500 trillion and a pric...View the full answer

Foundations of Macroeconomics

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