Refer to Figure 11-7. When output level is 100, what is the total cost of production?

Suppose there is a new technological invention that will allow you to put any resource into a special black box and in an instant anything that you program it to produce will be produced? Does this invention end scarcity? Why or why not?

What will be an ideal response?

Show the short-run impact of the following factors on GDP using a graph of the aggregate goods and services market. Assume the economy was originally in long-run equilibrium

a. a stock market crash b. a decrease in the real interest rate c. a flood that destroys most agricultural crops d. a decrease in resource prices e. an increase in the labor force f. an increase in the expected inflation rate