Real GDP
... fallacy of composition, causes of business cycles, risk of government failure versus market failure, role for government, and are on different political sides. ...
... fallacy of composition, causes of business cycles, risk of government failure versus market failure, role for government, and are on different political sides. ...
NBER WORKING PAPER SERIES FISCAL POLICY AND UNEMPLOYMENT Marco Battaglini Stephen Coate
... creases private sector hiring, while increasing public production creates public sector jobs. Thus, tax cuts and increases in public production reduce unemployment. However, both actions are costly for the government. We show that in this model there would be no unemployment in the long run with a ...
... creases private sector hiring, while increasing public production creates public sector jobs. Thus, tax cuts and increases in public production reduce unemployment. However, both actions are costly for the government. We show that in this model there would be no unemployment in the long run with a ...
Real vs. Nominal Interest Rates
... of your first year, you have $525 in your saving account. This is a good deal if you have zero inflation. Without inflation, the price level doesn’t change, and the $525 you have buys 5% more goods than your initial amount did. But let’s say that there is inflation. That means that what was once onl ...
... of your first year, you have $525 in your saving account. This is a good deal if you have zero inflation. Without inflation, the price level doesn’t change, and the $525 you have buys 5% more goods than your initial amount did. But let’s say that there is inflation. That means that what was once onl ...
Parkin_Macro_9e_clicker_ch10
... of BMWs increase by 10 percent and the money wage rate and other costs ________, there will be ________. A. increase by 10 percent; an increase in BMWs profits B. do not change; an increase in BMW’s production and profit C. increase by 10 percent; an increase in BMWs production D. do not change; no ...
... of BMWs increase by 10 percent and the money wage rate and other costs ________, there will be ________. A. increase by 10 percent; an increase in BMWs profits B. do not change; an increase in BMW’s production and profit C. increase by 10 percent; an increase in BMWs production D. do not change; no ...
Allied Social Science Associations meetings Boston, MA, January 3
... It is Keynes’s fundamental proposition that the level of employment in an economy is determined by effective demand. His attack against the classical view that whenever unemployment exists it could be reduced by a lowering of money wages is based on the necessity to consider the repercussions of wag ...
... It is Keynes’s fundamental proposition that the level of employment in an economy is determined by effective demand. His attack against the classical view that whenever unemployment exists it could be reduced by a lowering of money wages is based on the necessity to consider the repercussions of wag ...
EquilibriuminAggregateEconomy
... eventually wages and prices increase. SAS shifts up to SAS2 and the economy is in long-run and short-run equilibrium at D at a higher price level, P2. ...
... eventually wages and prices increase. SAS shifts up to SAS2 and the economy is in long-run and short-run equilibrium at D at a higher price level, P2. ...
Equilibrium in Aggregate Economy Equilibrium in the Aggregate
... • The inflationary gap occurs when the economy is above potential that exists at the current price level. • Factor prices rise causing the SAS curve to shift up. • The price level rises, and the inflationary gap is eliminated. ...
... • The inflationary gap occurs when the economy is above potential that exists at the current price level. • Factor prices rise causing the SAS curve to shift up. • The price level rises, and the inflationary gap is eliminated. ...
AP Macroeconomics AS/AD and Fiscal Policy Test
... ____ 13. In response to an increase in government spending of $10 billion, gross domestic product rises by a total of $20 billion. The marginal propensity to save is a. 0.1 b. 0.2 c. 0.5 d. 0.8 e. 0.9 ____ 14. An increase in the stock of capital goods will cause the a. aggregate demand curve to shif ...
... ____ 13. In response to an increase in government spending of $10 billion, gross domestic product rises by a total of $20 billion. The marginal propensity to save is a. 0.1 b. 0.2 c. 0.5 d. 0.8 e. 0.9 ____ 14. An increase in the stock of capital goods will cause the a. aggregate demand curve to shif ...
Chapter 9: Monetary Policy
... After 1984 the Fed reduced its emphasis on targeting the growth rate of M1, believing that innovations in banking made the money demand function less reliable, returning instead to interest rate targets. Here is how interest rate targeting has worked. The Board, and particularly its Chair, along wit ...
... After 1984 the Fed reduced its emphasis on targeting the growth rate of M1, believing that innovations in banking made the money demand function less reliable, returning instead to interest rate targets. Here is how interest rate targeting has worked. The Board, and particularly its Chair, along wit ...
經濟學講義(97
... Un-E that results because the number of jobs available in some labor markets is insufficient to provide a job for everyone who wants one. (because wage is set above the equilibrium when labor demand and supply is equal) (p627-634 explanation：minimum wage laws, unions, and efficiency wages)) ...
... Un-E that results because the number of jobs available in some labor markets is insufficient to provide a job for everyone who wants one. (because wage is set above the equilibrium when labor demand and supply is equal) (p627-634 explanation：minimum wage laws, unions, and efficiency wages)) ...
Problem Set 7 - Shepherd Webpages
... Y same, i up, P up; Consumption up because taxes decrease; Investment down because interest rate (i) increases. An increase in unemployment benefits affects the aggregate labor market first. It thus shifts the aggregate supply curve first. Specifically, it shifts the aggregate supply curve UP. The r ...
... Y same, i up, P up; Consumption up because taxes decrease; Investment down because interest rate (i) increases. An increase in unemployment benefits affects the aggregate labor market first. It thus shifts the aggregate supply curve first. Specifically, it shifts the aggregate supply curve UP. The r ...
Interactive Tool
... different seasons and in different areas. There are always some prices increasing and others decreasing as demand and supply conditions change in the markets. Inflation is an increase in average or overall price levels. It is not increases in specific markets or differences in prices in seasons or a ...
... different seasons and in different areas. There are always some prices increasing and others decreasing as demand and supply conditions change in the markets. Inflation is an increase in average or overall price levels. It is not increases in specific markets or differences in prices in seasons or a ...
Volume 36, Issue 4
... derive from the nonlinearities in the output-inflation nexus highlighted by recent theoretical studies. We cannot detect, though, the threshold after which the effect of inflation on output either disappears or turns negative, exactly because of low inflation rates throughout our sample. Under a pol ...
... derive from the nonlinearities in the output-inflation nexus highlighted by recent theoretical studies. We cannot detect, though, the threshold after which the effect of inflation on output either disappears or turns negative, exactly because of low inflation rates throughout our sample. Under a pol ...
OECD Labour Markets in the Great Recession
... • USA consistently shows up as having bigger fall in employment, bigger fall in hours and bigger rise in unemployment than predicted by the fall in its GDP and the size of the construction sector • Germany (and Japan) experience lower fall in employment and smaller rise in unemployment than predicte ...
... • USA consistently shows up as having bigger fall in employment, bigger fall in hours and bigger rise in unemployment than predicted by the fall in its GDP and the size of the construction sector • Germany (and Japan) experience lower fall in employment and smaller rise in unemployment than predicte ...
The mysrery of real wage
... This paper has differs from previous studies as blows: a) The relation between income and consumption is a very typical saturation nonlinearity one. For this kind of issues, this paper forsakes the weighted average method, and introduces the sectionalized linearization, a processing method frequentl ...
... This paper has differs from previous studies as blows: a) The relation between income and consumption is a very typical saturation nonlinearity one. For this kind of issues, this paper forsakes the weighted average method, and introduces the sectionalized linearization, a processing method frequentl ...
AP Macro FRQs - Mounds View School Websites
... b) If the Federal Reserve wants to lower the federal funds rate, what open-market operation would be appropriate? c) Assume that the open-market operation that you indicated in part (b) is equal to $10 million. If the required reserve ratio is 0.2, calculate the maximum change in loans throughout th ...
... b) If the Federal Reserve wants to lower the federal funds rate, what open-market operation would be appropriate? c) Assume that the open-market operation that you indicated in part (b) is equal to $10 million. If the required reserve ratio is 0.2, calculate the maximum change in loans throughout th ...
Full employment
Full employment, in macroeconomics, is the level of employment rates where there is no cyclical or deficient-demand unemployment. It is defined by the majority of mainstream economists as being an acceptable level of unemployment somewhere above 0%. The discrepancy from 0% arises due to non-cyclical types of unemployment, such as frictional unemployment (there will always be people who have quit or have lost a seasonal job and are in the process of getting a new job) and structural unemployment (mismatch between worker skills and job requirements). Unemployment above 0% is seen as necessary to control inflation in capitalist economies, to keep inflation from accelerating, i.e., from rising from year to year. This view is based on a theory centering on the concept of the Non-Accelerating Inflation Rate of Unemployment (NAIRU); in the current era, the majority of mainstream economists mean NAIRU when speaking of ""full"" employment. The NAIRU has also been described by Milton Friedman, among others, as the ""natural"" rate of unemployment. Having many names, it has also been called the structural unemployment rate.The 20th century British economist William Beveridge stated that an unemployment rate of 3% was full employment. Other economists have provided estimates between 2% and 13%, depending on the country, time period, and their political biases. For the United States, economist William T. Dickens found that full-employment unemployment rate varied a lot over time but equaled about 5.5 percent of the civilian labor force during the 2000s. Recently, economists have emphasized the idea that full employment represents a ""range"" of possible unemployment rates. For example, in 1999, in the United States, the Organisation for Economic Co-operation and Development (OECD) gives an estimate of the ""full-employment unemployment rate"" of 4 to 6.4%. This is the estimated unemployment rate at full employment, plus & minus the standard error of the estimate.The concept of full employment of labor corresponds to the concept of potential output or potential real GDP and the long run aggregate supply (LRAS) curve. In neoclassical macroeconomics, the highest sustainable level of aggregate real GDP or ""potential"" is seen as corresponding to a vertical LRAS curve: any increase in the demand for real GDP can only lead to rising prices in the long run, while any increase in output is temporary.