- section 4 .1: A fall in the value of the dollar against other currencies makes U....
- section 4 .2: Your study partner is confused by the upward -sloping short-run agg...
- section 4 .3: Suppose that in Wageland all workers sign annual wage contracts eac...
- section 4 .4: Determine whether, in the short run, each of the following events c...
- section 4 .5: Suppose that all households hold all their wealth in assets that au...
- section 4 .6: Suppose that the economy is currently at potential output. Also sup...
- section 4 .7: Explain whether the following government policies affect the aggreg...
- section 4 .8: In Wageland, all workers sign an annual wage contract each year on ...
- section 4 .9: The Conference Board publishes the Consumer Confidence Index (CCI) ...
- section 4 .10: There were two major shocks to the U.S. economy in 2007, leading to...
- section 4 .11: Using aggregate demand, short -run aggregate supply, and long - run...
- section 4 .12: Using aggregate demand, short -run aggregate supply, and long -run ...
- section 4 .13: The economy is in short -run macroeconomic equilibrium at point E1 ...
- section 4 .14: In the accompanying diagram, the economy is in long -run macroecono...
- section 4 .15: The late 1990s in the United States were characterized by substanti...
- section 4 .16: In each of the following cases, either a recessionary or inflationa...
- section 4 .17: Most macroeconomists believe it is a good thing that taxes act as a...
- section 4 .18: The accompanying table shows how consumers marginal propensities to...
- section 4 .19: From 2003 to 2008, Eastlandia experienced large fluctuations in bot...
- section 4 .20: From the end of 1995 to March 2000, the Standard and Poors 500 (S&P...
- section 4 .21: How will investment spending change as the following events occur? ...
- section 4 .22: Explain how each of the following actions will affect the level of ...
- section 4 .23: The accompanying diagram shows the current macroeconomic situation ...
- section 4 .24: The accompanying diagram shows the current macroeconomic situation ...
- section 4 .25: An economy is in long -run macroeconomic equilibrium when each of t...
Solutions for Chapter section 4 : National Income and Price Determination
Full solutions for Krugman's Economics for AP* | 2nd Edition
changes in fiscal policy that stimulate aggregate demand when the economy goes into a recession without policymakers having to take any deliberate action
an excess of government spending over government receipts
a shortfall of tax revenue from government spending
constant returns to scale
the property whereby long-run average total cost stays the same as the quantity of output changes
a graph of the relationship between the price of a good and the quantity demanded
diseconomies of scal
the property whereby long-run average total cost rises as the quantity of output increases
gross domestic product (GDP)
the market value of all final goods and services produced within a country in a given period of time
income elasticity of demand
a measure of how much the quantity demanded of a good responds to a change in consumers’ income, computed as the percentage change in quantity demanded divided by the percentage change in income
marginal rate of substitution
the rate at which a consumer is willing to trade one good for another
model of aggregate demand and aggregate supply
the model that most economists use to explain shortrun fluctuations in economic activity around its long-run trend
the total income in the economy that remains after paying for consumption and government purchases
the inputs into the production of goods and services that are provided by nature, such as land, rivers, and mineral deposits
a good for which, other things being equal, an increase in
a person for whom another person, called the agent, is performing some act
a particular “game” between two captured prisoners that illustrates why cooperation is difficult to maintain even when it is mutually beneficial
people who systematically and purposefully do the best they can to achieve their objectives
an event that directly alters firms’ costs and prices, shifting the economy’s aggregate supply curve and thus the Phillips curve
the manner in which the burden of a tax is shared among participants in a market
total revenue (in a market)
the amount paid by buyers and received by sellers of a good, computed as the price of the good times the quantity sold
Tragedy of the Commons
a parable that illustrates why common resources are used more than is desirable from the standpoint of society as a whole