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Author Question: If the quantity of money supplied ________ the quantity demanded, in the long run the value of money ... (Read 91 times)

evelyn o bentley

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on: Jun 29, 2018
If the quantity of money supplied ________ the quantity demanded, in the long run the value of money ________.
 
  A) is less than; does not change unless the Fed increases the money supply
  B) exceeds; falls as people spend their surplus money
  C) is less than; falls as people spend their surplus money
  D) exceeds; rises as people buy bonds
  E) equals; equals zero

Question 2

Explain how some structural changes can increase the natural unemployment rate while other structural changes can decrease the natural unemployment rate.
 
  What will be an ideal response?


lolol

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Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

Any structural change creates some jobs and destroys others. The effect of structural change on the natural unemployment rate depends on how well the skills required for the new jobs align with the skills possessed by workers looking for jobs and how well the locations of the jobs align with the workers looking for jobs. If the skills and locations are similar, so that the jobs are good matches for people looking for work, then the structural change brings a structural boom and the natural unemployment rate decreases. However, if the skills and locations are different, so that the workers looking for work are not good matches for the newly created jobs, structural change creates a structural slump and the natural unemployment rate rises.


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