things equal, what effects would each of the following have on aggregate demand or aggregate supply? In each case use a diagram to show the expected effects on the equilibrium price level and the level of real output. a. A reduction in the economy’s real interest rate. b. A major increase in federal spending for health care (with no increase in taxes). c. The complete disintegration of OPEC, causing oil
Other things equal, what effects would each of the following have on aggregate demand or
effects on the
real output.
a. A reduction in the economy’s real interest rate.
b. A major increase in federal spending for health
care (with no increase in taxes).
c. The complete disintegration of OPEC, causing oil
prices to fall by one-half.
d. A 10 percent reduction in personal income tax
rates (with no change in government spending).
e. A sizable increase in labor productivity (with no
change in nominal wages).
f. A 12 percent increase in nominal wages (with no
change in productivity).
g. A sizable depreciation in the international value of
the dollar.
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