In 2000, a Major U

question 84

Essay

In 2000, a major U.S. oil company began exploration off the southeastern coast of the United States. Suppose the company discovers huge reserves of natural gas. Using the aggregate demand/ aggregate supply model, predict what shifts will occur and what will happen to output and prices in both the long and short runs.

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Definitions:

Services

Intangible activities or benefits that are typically provided to satisfy the needs or wants of consumers or businesses.

Goods

Tangible products or items that satisfy human wants or needs and can be transferred from one person to another.

Product Market

The platform where end products or services are made available to individuals, companies, and the general public.

Households

Individuals or groups of people living together as a single unit, making economic decisions and consuming goods and services.