The Keynesian Short-Run Aggregate Supply Curve— Sticky Prices
... the price level. It was a period of high unemployment of resources and double-digit unemployment—that is, sufficient level of excess capacity and little competition to bid up input prices. Most macroeconomists now believe that price and wages are not completely inflexible downward. However, wages an ...
... the price level. It was a period of high unemployment of resources and double-digit unemployment—that is, sufficient level of excess capacity and little competition to bid up input prices. Most macroeconomists now believe that price and wages are not completely inflexible downward. However, wages an ...
Macro_3.4-_Classical_vs._Keynesian
... “The long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is past the ocean is ...
... “The long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is past the ocean is ...
Chapter 24: Measuring the Cost of Living
... Money loaned out is worth less when repaid Add expected inflation onto price charged for loan (interest rate) The rate you pay now (nominal) = expected inflation +real IR ...
... Money loaned out is worth less when repaid Add expected inflation onto price charged for loan (interest rate) The rate you pay now (nominal) = expected inflation +real IR ...
Demand shocks and sticky prices
... bonds, etc. • Economic investment is creation/expansion of business enterprise**Key***Investment is limited by the amount of saving ...
... bonds, etc. • Economic investment is creation/expansion of business enterprise**Key***Investment is limited by the amount of saving ...
Chapter 23 PowerPoint Presentation - McGraw
... • Unemployment rate • 4.6% in 2007 • Inflation rate • 2.7% in 2007 ...
... • Unemployment rate • 4.6% in 2007 • Inflation rate • 2.7% in 2007 ...
Aggregate-Demand
... Slopes downward & to the right: 1. a general fall in prices increases the real value of wealth so increases AD (we can afford to buy more!) 2. It also lowers the prices of our goods compared to other countries leading to increased exports. ...
... Slopes downward & to the right: 1. a general fall in prices increases the real value of wealth so increases AD (we can afford to buy more!) 2. It also lowers the prices of our goods compared to other countries leading to increased exports. ...
(DOCX, Unknown)
... believe they will make more profits however this is not the case as all prices are going up. When they think they are making more money they produce more than when they notice it goes down again. Sticky wages- In the economy the prices are increasing at different speeds this may be because of contra ...
... believe they will make more profits however this is not the case as all prices are going up. When they think they are making more money they produce more than when they notice it goes down again. Sticky wages- In the economy the prices are increasing at different speeds this may be because of contra ...
Information Constraints as Micro-foundations for Nominal Rigidity
... Decrease in consumption tax often doesn’t translate in immediate decrease of prices Input cost hikes do not have rapid effects ...
... Decrease in consumption tax often doesn’t translate in immediate decrease of prices Input cost hikes do not have rapid effects ...
... This paper is a sequel to Working Paper No. 3131, "Hypotheses of Sticky Wages and Prices". My first objective is to re-examine the historical record of prices and wages. What changes in their behavior are indicated by the data and how can they be explained? Next, the models that imply that price fle ...