Explain how a market demand curve is constructed
What will be an ideal response?
The market demand curve is the horizontal summation of the individual demand curves. A price is selected, and the quantities demanded of each person at that price are summed. Then another price is selected and the quantities demanded of each person at that price are summed. Continue doing this for other prices until the market demand curve is traced out.
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What are the problems associated with the sale of human organs?
An increase in available resources, or a technological advancement that enhances the productivity of one or more types of resources, can shift the PPF outward and lead to economic growth
Indicate whether the statement is true or false
Pure public goods involve positive externalities.
A. True B. False C. Uncertain
Figure 14-5
In , AD1 and SRAS1 indicate an economy initially operating at full-employment output level, Y1. The short-run impact of the Fed unexpectedly shifting to a more restrictive monetary policy will be
a.
a decrease in aggregate demand to AD2 and a decrease in real output to Y2.
b.
a decrease in aggregate demand to AD2 but real output would remain at Y1.
c.
a decrease in aggregate demand to AD2 and an increase in short-run aggregate supply to SRAS2, causing the price level to fall to P3 and real output to remain unchanged at Y1.
d.
no change; AD and SRAS will stay at AD1 and SRAS1.