Show the Short-Run Impact of the Following Factors on GDP

question 172

Essay

Show the short-run impact of the following factors on GDP using a graph of the aggregate goods and services market. Assume the economy was originally in long-run equilibrium.
a.a stock market crash
b.a decrease in the real interest rate
c.a flood that destroys most agricultural crops
d.a decrease in resource prices
e.an increase in the labor force
f.an increase in the expected inflation rate

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Definitions:

Day

A unit of time equal to 24 hours, representing the period it takes for the Earth to complete one full rotation on its axis.

Poverty Rate

The percentage of the population whose income falls below the poverty line, indicating their inability to meet basic needs.

Americans

Citizens or nationals of the United States, also referring collectively to the inhabitants of the country.

Food Stamps

is a government assistance program that provides low-income individuals and families with funds to purchase groceries, formally known as the Supplemental Nutrition Assistance Program (SNAP).