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Macroeconomics(TenthEdition)
RudigerDornbusch,StanleyFisher,RichardStarts
CHAPTER1INTRODUCTION
ConceptualProblems
1.Usingtheaggregatesupply-aggregatedemandmodelexplainhowoutputand
pricearedetermined.Willoutputvaryorstayfixedinthelongrun?Supposethe
aggregatedemandcurveweretoremainfixed:whatcanweinferaboutthe
behaviorofpricesovertime?
Answer:
Thewayoutputandpricesaredeterminedintheaggregatecanbeanalyzedmost
easilyusingtheAD-ASmodel;however,wehavetodeterminefirstwhichtimeframe
wehaveinmind.
TheverticalAS-curvedescribestheverylongrunandoutputisdeterminedby
demandrelativetotheoutputtheeconomycansupply.
ThehorizontalAS-curvedescribestheveryshortrunandoutputisdeterminedby
output.
Theupward-slopingAS-curvedescribesthemediumrunandfluctuationsin
undertheassumptionthatproductivecapacityisgiven.
TheAD-ASframeworkisaverysimplifiedrepresentationoftherealworldthat
cannotdescribethebehaviorofallpeopleandenterprisesinaneconomy.Inthis
framework,theeffectsofchangesinaggregatedemandonoutputandpricesdepend
largelyontheslopeoftheAS-curve.Weshouldkeepinmindthatthelong-run
wouldchange,thatis,declineovertime.
TechnicalProblems
1.Supposethatactualoutputis$120billionandpotential(full-employment)
outputis$156billion.Whatisanoutputgapinthishypotheticaleconomy?
Basedonyourestimateoftheoutputgap,wouldyouexpecttheunemployment
leveltobehigherorlowerthanusual?
Answer：
ThetextbookdefinestheoutputgapasthedifferencebetweenactualGDPand
Sinceactualoutputfallsshortofpotentialoutput,weshouldexpectthe
unemploymentratetobehigherthanusual.
Chapter2NationalIncomeAccounting
ConceptualProblems
1.whatwouldhappentoGDPifthegovernmenthiredunemployedworkers,
whohadbeenreceivingamount$TRi
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