Question

You work for Dr. Zhang, the autocratic dictator of Zhouland. After taking an economics course, you decide that devaluing your currency (Zhoullars) is the way to increase GDP. Following your advice, Dr. Zhang orders massive increases in the supply of Zhoullars, which reduces the value of Zhoullars in world markets. Use the AD-AS model and assume the economy was in a long-run equilibrium before this change. Remember to consider only this change as you determine your answers.
In the short run, the policy will cause the price level to _____, real GDP to _____, and the unemployment rate to _____.
a. increase; decrease; increase
b. increase; increase; increase
c. increase; increase; decrease
d. decrease; increase; decrease

Answer 1

The policy will result in an increase in real GDP, a decrease in unemployment, and an increase in the price level in the short term.

Describe a dictator.

A political figure with absolute power is a dictator. A dictatorship is a country where one or a few dictators are in power. the name of a Roman dictator who was chosen by the Roman Senate to lead the republic in times of emergency (see Roman dictator and justitium).

The term "dictator" came to be almost entirely employed as a non-titular term denoting repressive control, much like the term "tyrant" and, to a lesser extent, "autocrat." The term "dictator" has been applied to a wide range of leaders who have assumed power in many types of regimes, including one-party states, dominant-party states, and civilian governments run by an individual.

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