If prices are sticky in the short run, then

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If prices are sticky in the short run, thengrocery gateway promo code july 2020

topics include sticky wage theory and menu cost theory, as well as the causes of short-run aggregate supply shocks. How will the firm respond to a negative demand shock if prices are flexible?The firm will continue to produce 500 computers per week and charge a price of $600Refer to the graph above. Gross domestic product (GDP) is the monetary value of all finished goods and services made within a country during a specific period. If prices are sticky, then a negative demand shock will lead to b. short-run decrease in real GDP.

Suppose a firm is currently producing 500 computers per week and charging a price of $1000.

Suppose a firm is currently producing 500 computers per week and charging a price of $1000. Sticky-down refers to the tendency of a price to move up easily but prove quite resistant to moving down. ThenMakes a country's output per person rise at a compounded rateUnder modern economic growth, the annual average increase in output per person isBefore the late 1700's, living standards in the richest part of the world wereAt most only two to three times higher than living standards in the poorest parts of the worldWhich of the following is not an adjustment made when comparing standards of living across countries?Adjusting for different unemployment rates across countriesAdjusting GDP figures for the fact that prices are much lower in some countries than in othersWhich among the following countries had the highest GDP per person in 2009?Resources are devoted toward increasing future outputOccur when current spending is less than current incomesThe amount of investment is ultimately limited by the amount of:Economic investment refers to the creation and expansion of business enterprisesWhich of the following is the best example of financial investment?Which of the following is the best example of economic investment?Which of the following is the best example of investment as defined by economists?A restaurant owner buys a freezer to store ingredients for the restaurant mealsWhich of the following best represents the effect of an increase in investment?One principle of economic growth is the notion that, to raise living standards over time, an economy must:Devote some portion of its current output to increasing its future outputWhich of the following is the principal source of savings in an economy?Savings are transferred from savers to borrowers through the following intermediaries, except:Complicated by the fact that the future is uncertainMore current investment and more future consumptionSituations in which firms expect one thing to happen but then something else happens are called:Sharply rising oil prices are most likely to lead to a:If consumers become pessimistic, the economy is likely to experience a:Does not tell us whether what has happened is unexpectedly bad or unexpectedly goodWhat impact will a negative demand shock have on the main measures of economic performance?Real GDP will decrease, inflation will decrease, and unemployment will increaseWhat impact will a negative supply shock have on the main measures of economic performance?Real GDP will decrease, inflation will increase, and unemployment will increaseEconomists believe that most short-run fluctuations:The economy will respond to demand shocks primarily through changes in output and employmentIf prices are inflexible, then a negative demand shock will lead to:Because prices are sticky, positive demand shock will lead to:Refer to the graph above. In year 2, 100,000 sets are produced and sold at a price of $1,000 each. In the sticky price model appositive relation between price and output exists in the short run.

Therefore, when the market-clearing price drops, the price remains artificially higher than the new market-clearing level, resulting in excess supply or a surplus. Short-run fluctuations in output and employment are referred to asThe situation where output and living standards decline is referred to asThe major statistics that provide macroeconomists a picture of the health of an economy include the following, except:measures the value of final goods and services produced within the borders of a given country during a given time period corrected for changing priceswill increase if there is an increase in the level of outputmeasures the value of final goods and services produced within the borders of a given country during a given time period using current pricescan change when there is a change in either output or the price levelSuppose that an economy's output does not change from one year to the next, but the price level doubles.

Expert Answer. 31. Price stickiness (or sticky prices) is the resistance of 1.

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