Question: I dont know to solve this Refer to the table given below. Suppose that aggregate demand increases such that the amount of real output demanded
I dont know to solve this

Refer to the table given below. Suppose that aggregate demand increases such that the amount of real output demanded rises by $7 billion at each price level. Real Output "amended uni-1:131 a. By what percentage will the price level increase? percent b. Will this inflation be demandpull inflation or will it be costpush ination? Demand-pull inf 3 c. If potential real GDP (that is, full-employment GDP) is $510 billion, what will be the size of the positive GDP gap after the change in aggregate demand? $ |:| billion d. If the government wants to use scal policy to counter the resulting inflation without changing tax rates, would it increase government spending or decrease it? Decrease 3
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
