Unit 8 Assignment

Ury Salinas Unit 8 Project MT445 Managerial Economics Chapter 19, distrust 5 (Economic Fluctuations) Why doesnt the National Bureau of Economic investigate identify the turning rates in economic activity until months after they hap? There be often fluctuations within the different phases of the economy which are caused the seasons and other chance snuff itrences. Oftentimes, these small disturbances are not enough to battle array economists that on that point is necessarily a problem because a drop in production might only be temporary.Recessions and economic depressions bear to be measured over a long menstruation of time to read an accu estimate idea of the economic stability of a region or country, and often you have to look back a long period in order to understand the problem. Question 15 (Aggregate hold and translate) look on whether separately of the following would cause a shift of the aggregate demand influence, a shift of the aggregate hang on curve, neithe r, or both. Which curve shifts, and in which direction? What happens to aggregate output and the price level in each case? a. The price level changes b.Consumer confidence declines c. The supply of resources increases d. The wage rate increases a. Price level changes affect both aggregative demand and aggregated supply curves. When price drops, it raises the amount of goods that are in demand. The short-run supply curve curves to the right. When price increases, there is a drop in the amount of goods and services supplied and the short-run aggregate supply curve curves toward the left. b. When consumer confidence declines, there is a decrease in the demand curve. This causes the curve to shift to the left. c.When the supply of resources increases, more products are being produced which supersedes demand for the item. This bequeath cause the curve to shift to the left. d. When wage rate increases, the supply curve shifts upward. Chapter 20, Question 12 (Convergence) Explain the co nvergence speculation. Under what circumstances is convergence unlikely to occur? Convergence theory says that developing countries have better or instant(prenominal) economic growth than advanced countries. The thought is that they grow faster because its easier to imitation the technology that is already in place, than it is to necessarily develop it on their own.This theory states that convergence is unlikely to occur in the poorest third of the world, partly because of higher(prenominal) population growth which reduces the quality of human enceinte. Question 15 (Growth and the PPF) utilization the production possibilities frontier (PPF) to demonstrate economic growth. a. With consumption goods on one(a) axis and capital goods on the other, show how the combination of goods selected this period affects the PPF in the next period. b. Extend this comparison by choosing a different point on this periods PPF and determining whether that combination leads to more or less growt h over the next period. . When the economy produces more consumer goods than capital goods, growth is lower. On the graph, this would be at the point on the axis where Y is very high compared to the X-coordinate. In the next period, this means that consumer goods have less production capacity. b. When more capital goods are produces than consumer goods, the growth is higher. On the graph, this would be where the Y-coordinate would be lower than its corresponding X-coordinate. This means that there will be more spending on capital goods and a greater outward shift for the next period.