Question

Cannot attach graph!

a. If the actual price level exceeds the expected price level reflected in long-term contracts, real GDP equals _______ and the actual price level equals _______ in the short run.
b. The situation described in part (a) results in a(n) _______ gap equal to _______.
c. If the actual price level is lower than the expected price level reflected in long-term contracts, real GDP equals _______ and the actual price level equals _______ in the short run.
d. The situation described in part (c) results in a(n) _______ gap equal to _______.
e. If the actual price level equals the expected price level reflected in long-term contracts, real GDP equals _______ and the actual price level equals _______ in the short run.
f. The situation described in part (e) results in a(n) _______ gap equal to _______.

This what I have so far.....
a. 14.2 trill, 130
b. expansionary, 0.2 trill
c. 13.7 trill, 110
d. recessionary, 0.3 trill
e. 14.0 trill, 120
f. ??, ??

Answer 1

The graph has a SRAS going up from
GDP 13.7 and 110 price level
GDP 14.0 and 120 price level
GDP 14.2 and 130 price level