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List of things that would shift the aggregate demand curve

Please see attached. It is easier to read than below.

1 U.S. real GDP is substantially higher today than it was 60 years ago. What does this tell us, and what does it not tell us, about the well-being of U.S. residents?

2. In a simple economy, people consume only 2 goods, food and clothing. The market basket of goods used to compute the CPI has 50 units of food and 10 units of clothing.

food
clothing

2002 price
$4
$10

2003 price
$6
$20

a. What are the percentage increases in the price of food and in the price of clothing?

b. What is the percentage increase in the CPI?

c. Do these price changes affect all consumers to the same extent? Explain.

3. The table below uses data for the year 2003 provided by the BLS and adjusted to be comparable to U.S. data. All values are in thousands. Fill in the blank entries in the table. Show your work!

Country

Adult

Population

Labor

Force

Employed

Unemployed

Unemployment

Rate
Labor-Force

Participation

Rate

Japan
109,474

62,510
3,500

France

26,870

2,577

57.41

Germany
70,159
39,591

9.69

4. Make a list of things that would shift the aggregate demand curve to the right.

5. Make a list of things that would shift the long-run aggregate supply curve to the right.

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1 U.S. real GDP is substantially higher today than it was 60 years ago. What does this tell us, and what does it not tell us, about the well-being of U.S. residents?
As per wikipedia "The gross domestic product (GDP) is one of the measures of national income and input for a given country's economy. GDP is defined as the total cost of all finished goods and services produced within the country in a stipulated period of time (usually a 365-day year). It is sometimes regarded as the sum of profits added at every level of production (the intermediate stages) of all final goods and services produced within a country in a stipulated timeframe, and it is rarely given a monetary value.
http://en.wikipedia.org/wiki/Gross_domestic_product.
Thus GDP tells about the increase in income of the country. But it may not tell about the ...

Solution Summary

Response describes the list of things that would shift the aggregate demand curve and supply curve

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