This topic contains a solution. Click here to go to the answer

Author Question: Discuss what factors could cause a real depreciation. What will be an ideal ... (Read 117 times)

pragya sharda

  • Hero Member
  • *****
  • Posts: 566
Discuss what factors could cause a real depreciation.
 
  What will be an ideal response?

Question 2

Explain what is meant by the wage-price spiral.
 
  What will be an ideal response?



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

fatboyy09

  • Sr. Member
  • ****
  • Posts: 358
Answer to Question 1

Decrease in E; increase in P; and decrease in P.

Answer to Question 2

The wage-price spiral refers to the effects of low unemployment on inflation. Specifically, when the unemployment rate falls, the nominal wage will rise. As W rises, firms' costs increase causing them to increase prices. As prices rise, workers will later ask for increases in the nominal wage. This increase in W again causes firms' costs and prices to rise and the process repeats itself.




pragya sharda

  • Member
  • Posts: 566
Reply 2 on: Jun 30, 2018
YES! Correct, THANKS for helping me on my review


kusterl

  • Member
  • Posts: 315
Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

Did you know?

The first oral chemotherapy drug for colon cancer was approved by FDA in 2001.

Did you know?

To maintain good kidney function, you should drink at least 3 quarts of water daily. Water dilutes urine and helps prevent concentrations of salts and minerals that can lead to kidney stone formation. Chronic dehydration is a major contributor to the development of kidney stones.

Did you know?

Malaria was not eliminated in the United States until 1951. The term eliminated means that no new cases arise in a country for 3 years.

Did you know?

The lipid bilayer is made of phospholipids. They are arranged in a double layer because one of their ends is attracted to water while the other is repelled by water.

Did you know?

Intradermal injections are somewhat difficult to correctly administer because the skin layers are so thin that it is easy to accidentally punch through to the deeper subcutaneous layer.

For a complete list of videos, visit our video library