The impact of Hurricane Katrina on consumers in the economy was to make them very pessimistic about their future incomes. How does increased pessimism affect the aggregate demand curve? a. This moves the economy up along a stationary aggregate demand curve.b. This moves the economy down along a stationary aggregate demand curve.c. this will shift the aggregate demand curve to the left.d. this will shift the aggregate demand curve to the right.

Answers

Answer 1
Answer:

Answer:

The correct answer is option c.

Explanation:

Because of a hurricane, there is a sense of pessimism among the consumers regarding their future incomes. This sense of pessimism would cause consumers to reduce their spending and save money for the future.  

This causes the consumption expenditure to decline. This reduction in the consumption expenditure will cause the aggregate demand to decrease as well. This will cause the aggregate demand curve to move to the left.  

This leftward shift in the aggregate demand curve will further cause the equilibrium price and quantity to decline.

Answer 2
Answer:

Final answer:

Increased pessimism about future income levels (prompted by events like Hurricane Katrina) leads to a shift to left in the aggregate demand curve, leading to a lower real GDP and lower price level. However, in the long run, these shifts only temporarily impact output and unemployment, as the real GDP is determined by potential GDP and aggregate supply.

Explanation:

In response to increased pessimism about future income, often prompted by events like Hurricane Katrina, the aggregate demand curve in the economy would shift to the left, option c. This is mainly due to decreased consumer spending which results in a lower real GDP and a lower price level.

This movement can occur in the aggregate supply curve's relatively flat or relatively steep portion, which determines the overall changes in output and price level. Ultimately though, in the long run, shifts like these in aggregate demand have a short-run impact on output and unemployment. The long-run size of real GDP is determined by potential GDP and aggregate supply when wages and prices are flexible.

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Related Questions

Consider a risky portfolio, A, with an expected rate of return of 0.15 and a standard deviation of 0.15, that lies on a given indifference curve. Which one of the following portfolios might lie on the same indifference curve for a risk averse investor?A) E(r) = 0.15; Standard deviation = 0.20.B) E(r) = 0.15; Standard deviation = 0.10.C) E(r) = 0.10; Standard deviation = 0.10.D) E(r) = 0.20; Standard deviation = 0.15.E) E(r) = 0.10; Standard deviation = 0.20.
In a(n) __________, two or more firms create a legally independent company to share some of their resources to create a competitive advantage. Group of answer choices equity strategic alliance nonequity strategic alliance joint venture equality-based strategic alliance
A grant for the exclusive right to make, use, or sell new or improved inventions
If you use credit what are you creatingA line of credit B debt C Collateral D a default
Keystone Foods, which invented the individual quick freeze process for beef, provides McDonald's with millions of pounds of chicken, beef, and fish annually for use in its restaurants. The firm sources the animal proteins from farms and processes them in a variety of ways, such as breading or freezing, before selling them to McDonald's. Keystone is operating in __________ market.

Which statement is true of an adjustable rate mortgage? a) Payments will adjust each year based on the amount of equity you have in your home
b) The interest rate will stay fixed for a period of time, then adjust either up or down based on an index
c) The interest rate can only change twice during the course of the loan
d) An adjustable rate mortgage always includes a balloon payment at the end of the 7th year

Answers

The answer is B. Adjustable rate mortgage is a mortgage loan where the interest rate stays for for a certain period of time then it changes either up or down based on an index. It is also called variable-rate mortgage or tracker mortgage. This type of mortgage loan permits a debtor to have a lower initial payment if and only if they agree to assume the risk of the changes in the interest rate.

Answer:

b

Explanation:

In the market for loanable funds, the __________ curve demonstrates the fact that as interest rates rise, people are willing to borrow less. As a result, this curve is __________.

Answers

In the market for loanable funds, the supplycurve demonstrates the fact that as interest rates rise, people are willing to borrow less. As a result, this curve is steep slope.

What is supply curve?

Supply curve is a graphical representation,it shows how price of a good or service is related to the quantity of goods and services supplied.

This is done for a given period of time.

Therefore, In the market for loanable funds, the supply curve demonstrates the fact that as interest rates rise, people are willing to borrow less. As a result, this curve is steep slope.

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"A client has been involuntarily committed to a hospital because he has been assessed as being dangerous to self or others. The client has lost which right?"

Answers

Answer:

The right to leave the hospital against medical advice

Explanation:

A patient (or relative in charge, if patient is unconscious) always has full freedom to make a decision on their health, for example leaving the hospital or rejecting an exam, even if it goes against what the doctor treating him advice, this applies as long as the patient can make an informed decision, for this the patient needs to be mentally available and physically able to demonstrate awareness of the situation and mental stability.

If a patient is having mental issues and is not able to understand or process the information given that the patient is deprived of the right to leave the hospital against medical advice, especially if the patient is dangerous as they could cause problems.

Increasing and decreasing the money supply through monetary policy is generally done by __________.

Answers

Increasing and decreasing the money supply through monetary policy is generally done by the Federal Reserve. It is actually the central banking system of the United states of America. It was founded on 23rd of December in the year 1913. I hope the answer has come to your desired help.

Answer:

expansionary

expansionary

contractionary

During a resuscitation, the team leader assigns team roles and tasks to each member. You recognize that a task has been overlooked. Which is the most appropriate action

Answers

During a resuscitation, if a task is overlooked, it's best to inform the team leader in a professional and respectful manner. The team leader is ultimately responsible for task coordination.

During a resuscitation, clear communication and role division are crucial. If you notice that a task has been overlooked, it would be most appropriate to bring it to the attention of the team leader in a respectful and professional manner. This is because the team leader is responsible for coordinating the team's efforts and ensuring that all necessary tasks are carried out.

For example, if you were part of a resuscitation team and realized that nobody had been assigned to administer medication, you could say, "Team leader, I have noticed that nobody has been assigned the task of administering medication. Would you like me to do it, or should we assign it to someone else?" This approach helps to ensure that all necessary tasks are completed without disrupting the team's workflow.

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Final answer:

During a resuscitation, if a task has been overlooked, the most appropriate action is to communicate this to the team leader or another team member.

Explanation:

During a resuscitation, it is important for the team leader to assign team roles and tasks to each member. However, if a task has been overlooked, the most appropriate action would be to communicate this to the team leader or another team member. This ensures that the task is addressed and assigned to the appropriate person promptly.

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You pay a monthly fee to have telephone service for your business. The amount you pay is the same every month. This is an example of a ________ cost.Question 8 options:

Fixed


Profit


Variable


Revenue

Answers

This is an example of  a fixed cost.