Figure 95 Alt Text for Figure 9

question 153

Multiple Choice

Figure 9.5 Alt text for Figure 9.5: In figure 9.5, a graph comparing real GDP and price level.
Long description for Figure 9.5: The x-axis is labelled, real GDP (trillions of 2007 dollars) , and the y-axis is labelled, price level (CPI) .5 lines are shown; SRAS1, SRAS2, AD1, AD2, and LRAS.Line SRAS1 begins above the vertex and slopes up to the top right corner.Line SRAS2 follows the same slope as line SRAS1, but is plotted to the right.Line AD1 begins at the top left corner and slopes down to the bottom center.Line AD2 follows the same slope as AD1, but is plotted to the right.Line SRAS1 intersects line AD1 at point C, more than half way along both the lines.Line SRAS1 intersects line AD2 at point B, approximately 3 quarters of the way along both lines.Line SRAS2 intersects line AD1 at point D, approximately 3 quarters of the way along both lines.Line SRAS2 intersects line AD2 at point A, more than half way along both lines.Line LRAS is perpendicular to the x-axis, passing through the points A and C, and intersecting all the 4 lines.
-Refer to Figure 9.5.Suppose the economy is at point A.If the economy experiences a supply shock, where will the eventual short-run equilibrium be?

• A)A
• B)B
• C)C
• D)D
• E)None of these points are consistent with a short-run equilibrium following a supply shock.

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Definitions:

Biological Needs

Biological needs are the essential requirements that organisms must meet to maintain life, such as food, water, air, and shelter.

Social Needs

The human requirements for companionship, belonging, inclusion, and being part of a community.

Homeostasis

The self-regulating process by which biological systems maintain stability while adjusting to conditions that are optimal for survival.

Reproductive Success

The passing of genes onto the next generation in a way that they too can pass on those genes.