# ENC 350 Chapters 10

ENC 350 Chapters 10

right in the following year? By how much, if any, has the aggregate demand curve shifted to the right? (Hint: The equilibrium price level can stay the same only if LRAS and AD shift rightward by the same amount.) (See page 232.) 10-4. Suppose that the position of a nation’s long-run aggregate supply curve has not changed, but its long-run equilibrium price level has increased. Which of the following factors might account for this event? (See page 232.) a. A rise in the value of the domestic currency relative to other world currencies b. An increase in the quantity of money in circulation c. An increase in the labor force participation rate d. A decrease in taxes e. A rise in real incomes of countries that are key trading partners of this nation f. Increased long-run economic growthAll problems are assignable inMyEconLab. Answers to odd-numbered problems appear inMyEconLab. 10-1. Many economists view the natural rate of unem-ployment as the level observed when real GDP is given by the position of the long-run aggregate supply curve. How can there be positive unem-ployment in this situation? (See page 223.) 10-2. Suppose that the long-run aggregate supply curve is positioned at a real GDP level of \$18 trillion in base-year dollars, and the long-run equilibrium price level (in index number form) is 115. What is the full-employment level of nominal GDP? (See page 231.) 10-3. Continuing from Problem 10-2, suppose that the full-employment level of nominal GDP in the fol-lowing year rises to \$21.85 trillion. The long-run equilibrium price level, however, remains unchanged. By how much (in real dollars) has the long-run aggregate supply curve shifted to the

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