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Author Question: Why are aggregate demand shocks not a good explanation of business cycles in the New Keynesian ... (Read 35 times)

saliriagwu

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on: Jun 30, 2018
Why are aggregate demand shocks not a good explanation of business cycles in the New Keynesian model?
 
  A) The wage is not constant.
  B) Employment does not fluctuate.
  C) Prices in the model are procyclical.
  D) Consumption is not procyclical.

Question 2

In Solow's exogenous growth model, the steady-state growth rate of capital can be increased by
 
  A) higher population growth.
  B) higher depreciation rate.
  C) higher saving rate.
  D) higher interest rate.


maya.nigrin17@yahoo.com

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Reply #1 on: Jun 30, 2018
Answer to Question 1

C

Answer to Question 2

A


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