Figure 15-4
-Refer to Figure 15-4.In the figure above,LRAS₁ and SRAS₁ denote LRAS and SRAS in year 1,while LRAS₂ and SRAS₂ denote LRAS and SRAS in year 2.Given the economy is at point A in year 1,what is the growth rate in potential GDP in year 2?

Question

Figure 15-4 Figure 15-4 -Refer to Figure 15-4.In the figure above,LRAS1 and SRAS1 denote LRAS and SRAS in year 1,while LRAS2 and SRAS2 denote LRAS and SRAS in year 2.Given the economy is at point A in year 1,what is the growth rate in potential GDP in year 2? A) 8% B) 9.1% C) 10% D) 12%

Figure 15-4 -Refer to Figure 15-4.In the figure above,LRAS<sub>1</sub> and SRAS<sub>1</sub> denote LRAS and SRAS in year 1,while LRAS<sub>2</sub> and SRAS<sub>2</sub> denote LRAS and SRAS in year 2.Given the economy is at point A in year 1,what is the growth rate in potential GDP in year 2? A) 8% B) 9.1% C) 10% D) 12%

-Refer to Figure 15-4.In the figure above,LRAS₁ and SRAS₁ denote LRAS and SRAS in year 1,while LRAS₂ and SRAS₂ denote LRAS and SRAS in year 2.Given the economy is at point A in year 1,what is the growth rate in potential GDP in year 2?

Quizplus · Accepted Answer

The growth rate in potential GDP is equal to the shift in LRAS from year 1 to year 2. From the graph, we can see that LRAS has shifted from LRAS₁ to LRAS₂, which represents a $2 trillion increase in potential GDP. Therefore, the growth rate in potential GDP is (2/20)*100 = 10%. So, the correct answer is option C.

Figure 15-4 -Refer to Figure 15-4.In the Figure Above,LRAS1 and SRAS1 Denote

Figure 15-4 -Refer to Figure 15-4.In the Figure Above,LRAS₁ and SRAS₁ Denote