This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Assume expectations of both prices and productivity are accurate,use the PS/WS relations, ... (Read 89 times)

Arii_bell

  • Hero Member
  • *****
  • Posts: 596
on: Jun 30, 2018
Assume expectations of both prices and productivity are accurate,use the PS/WS relations, graphically illustrate and explain the effects of an increase in the productivity on the natural rate of unemployment.
 
  What will be an ideal response?

Question 2

Graphically illustrate and explain what effect a purchase of bonds by the Federal Reserve will have on the money market.
 
  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

SomethingSomething

  • Sr. Member
  • ****
  • Posts: 323
Reply #1 on: Jun 30, 2018
Answer to Question 1

An increase in productivity shifts both the wage and the price-setting curves by the same proportion and thus has no effect on the natural rate.

Answer to Question 2

A Fed purchase of bonds will cause an increase in H and an increase in the money supply. At the initial interest rate, there will be an excess supply of money. The interest rate will fall to restore money market equilibrium. All else fixed, there will be no change in money demand.


Arii_bell

  • Member
  • Posts: 596
Reply 2 on: Jun 30, 2018
:D TYSM

sultana.d

  • Member
  • Posts: 320
Reply 3 on: Yesterday
Great answer, keep it coming :)

« previous next »
 

Did you know?

Hypertension is a silent killer because it is deadly and has no significant early symptoms. The danger from hypertension is the extra load on the heart, which can lead to hypertensive heart disease and kidney damage. This occurs without any major symptoms until the high blood pressure becomes extreme. Regular blood pressure checks are an important method of catching hypertension before it can kill you.

Did you know?

The first oncogene was discovered in 1970 and was termed SRC (pronounced "SARK").

Did you know?

For about 100 years, scientists thought that peptic ulcers were caused by stress, spicy food, and alcohol. Later, researchers added stomach acid to the list of causes and began treating ulcers with antacids. Now it is known that peptic ulcers are predominantly caused by Helicobacter pylori, a spiral-shaped bacterium that normally exist in the stomach.

Did you know?

The liver is the only organ that has the ability to regenerate itself after certain types of damage. As much as 25% of the liver can be removed, and it will still regenerate back to its original shape and size. However, the liver cannot regenerate after severe damage caused by alcohol.

Did you know?

Always store hazardous household chemicals in their original containers out of reach of children. These include bleach, paint, strippers and products containing turpentine, garden chemicals, oven cleaners, fondue fuels, nail polish, and nail polish remover.

In 2008, the U.S. economy suffered a gaping wound as several trillion dollars were ripped out of it. In 2008, the U.S. economy suffered a gaping wound as several trillion dollars were ripped out of it.
This portrait of Thomas Jefferson is considered an accurate likeness, painted when he was thirty-sev This portrait of Thomas Jefferson is considered an accurate likeness, painted when he was thirty-sev
Natural Resource Prices, 1850–2010 Natural Resource Prices, 1850–2010
Prices in Japan before and after Opening to Trade Prices in Japan before and after Opening to Trade
An archaeological sample contains 0.700 g of lead-206 and 2.144 g of uranium-238. Assume that ... An archaeological sample contains 0.700 g of lead-206 and 2.144 g of uranium-238. Assume that ...
Remote satellite monitoring of gross primary productivity across the United States. The differences Remote satellite monitoring of gross primary productivity across the United States. The differences
Video: Baroreceptor Reflex

For a complete list of videos, visit our video library