An expected future increase in total factor productivity does NOT affect:
current output demand. |
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current investment demand. |
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current labor demand. |
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current wages. |
An expected increase in total factor productivity affects current wages and demand for factors.Current output demand is not affected.
Answer-Current output demand
An expected future increase in total factor productivity does NOT affect: current output demand. current investment...
Suppose there is a permanent increase in total factor productivity. Show what will happen to wages and the equilibrium quantity of labor using a graph of the labor market. Explain. Why is your answer different from problem number (3)?
2. Assume the economy is initially in equilibrium, and then firms expect future total factor productivity, z', to decrease. Using the New Keynesian Model framework, what are the implications on the following outcomes. For the money market, use the framework with interest rates on the vertical axis. f) Wages (increase / decrease / indeterminate / no change)? g) Money supply increase / decrease / indeterminate / no change)? h) Money demand increase / decrease / indeterminate / no change)? i)...
The equilibrium effects of a prospective future increase in total factor productivity include Question 1 options: 1) an increase in the real wage and an increase in the real interest rate. 2) an increase in the real wage and a decrease in the real interest rate. 3) a decrease in the real wage and an increase in the real interest rate. 4) a decrease in the real wage and a decrease in the real interest rate. 5) a decrease in...
An increase in total factor productivity causes the Question 9 options: 1) production function to shift up, labour demand to shift right, and output supply to shift right. 2) production function to shift up, labour demand to shift left, and output supply to shift right. 3) production function to shift up, labour demand to shift right, and output supply to shift left. 4) production function to shift down, labour demand to shift left, and output supply to shift left. 5)...
In the one-period model in Chapter 5, an increase in total factor productivity reduces consumption, increases output, and increases the real wage. increases consumption, increases output, and increases the real wage. reduces consumption, reduces output, and reduces the real wage. reduces consumption, increases output and reduces the real wage.
How does an increase in the amount of education affect an economy's productivity and income? Please explain extensively. Thank you
Other things equal, an increase in productivity will: 1) reduce aggregate supply and increase real output. 2) reduce both the interest rate and the international value of the dollar. 3) increase both aggregate supply and real output. 4) increase net exports, increase investment, and reduce aggregate demand.
3. Explain using graphs of how a productivity increase effects the supply and demand for aggregate output, and the supply and demand for labor. [hint: To do this, label all axes and graphs correctly, and show how each the supply and the demand shifts in each of the goods and labor markets].
Other things held constant, investment in physical capital will increase: labor productivity. national income. wages. all of the above
3. Which determinant(s) of worker's productivity technology (or more gen- erally total factor productivity) A, physical capital per worker human capital per worker , and/or natural resources per worker †l will be affected and how (increase or decrease) if the government: (a) increases grants for academic research (b) restricts low-skilled labor immigration (c) improves the quality of the health care system (d) attracts foreign direct investment (e) engages in inward-oriented trade policies (f) is ousted by a military coup, which...