Homework Answers
Since natural level of unemployment is that unemployment at which there is some frictional and structural unemployment exist, this is short-term temporary unemployment and it may vanish in near future. So natural level of unemployment is usually 5%.
Hence it can be said that the natural level of unemployment is that amount of unemployment that economy normally experiences.
Hence option first is the correct answer.
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Which of the following best defines the natural rate of unemployment? Select one: .00 O It...
- 14. The natural rate of unemployment is the a, unemployment rate that would prevail with...
- 14. The natural rate of unemployment is the a, unemployment rate that would prevail with zero inflation. b. rate associated with the highest possible level of GDP. c. difference between the long-run and short-run unemployment rates. d. amount of unemployment that the economy normally experiences. 15. Suppose that the adult population in some country is 225 million. If 40 million are unemployed and 100 employed, then the unemployment rate is approximately a. 29% b.18% c. 24%. d. 6% 16....
With respect to GDP, how are transfer payments treated? Select one: :.00 O They are included...
With respect to GDP, how are transfer payments treated? Select one: :.00 O They are included in GDP because they represent income to individuals They are not included in GDP because taxes will have to be raised to pay for them O They are not included in GDP because they are not payments for currently produced goods or s ion They are included in GDP because the income will be spent for consumption. ous page ce Desk Support: 613-520-3700 or...
If unemployment is above the natural level of unemployment, which one of these statements MUST be...
If unemployment is above the natural level of unemployment, which one of these statements MUST be true? Select one: O a. Employment must be below full employment O b. Cyclical unemployment must be negative o c. Real GDP must be above potential GDP d. The economy must be in an expansion e. The economy is experience a strong demand-pulled inflation
If the economy is at the natural rate of unemployment with the level of real GDP...
If the economy is at the natural rate of unemployment with the level of real GDP at potential output, what would expansionary fiscal or monetary policy do to the economy? How would the economy be effected in the short run and long run? Does the Phillips Curve theory explain what happens?
If the natural rate of unemployment is 6 percent, what is the actual unemployment rate for...
If the natural rate of unemployment is 6 percent, what is the
actual unemployment rate for this economy (use Okun’s law given
Y* = 29,000).
Actual unemployment rate: ?? %
Conslder the economy described by the following equations: C 1,500 + 8.9 (Y- T) P1808 T1,580 a. Complete the table shown below to find short-run equilibrium output. Conslder possible values for short-run equilibrlum output as they are given In the table below. Instructions: If you are entering any negative...
13. Which of the following statements is (are) correct? (x) The natural rate of unemployment is...
13. Which of the following statements is (are) correct? (x) The natural rate of unemployment is the amount of the unemployment that the economy normally experiences. (y) Cyclical unemployment refers to the year-to-year fluctuations of unemployment around its natural rate that are due to short-run ups and downs of the economy (z) Suppose the natural rate of unemployment is 5.5 percent and the current rate of unemployment is 8.1 percent. The cyclical unemployment rate is a positive value of 2.6...
Problem 3.(36 points) Suppose the natural rate of unemployment equals 5%, and the Phillips curve is given by πt = πte −...
Problem 3.(36 points) Suppose the natural rate of unemployment equals 5%, and the Phillips curve is given by πt = πte − 0.25(ut − u∗t ). Suppose originally the economy is in the long run equilibrium, in which πte = 4%. 1. Determine unemployment and inflation rates corresponding to the original equilibrium. 2. Draw the Philips curve diagram with SRPC and LRPC. Mark the original long run equilibrium. 3. Suppose now the central bank performs a monetary expansion and raises...
You are given that the economy has a natural rate of unemployment of 3.3%. Let inflation...
You are given that the economy has a natural rate of unemployment of 3.3%. Let inflation change by -0.3 percentage points. Assuming a slope of 1/3, use the Phillips Curve and Okun's Law to fine the corresponding unemployment rate. Note: find short run output first, then the unemployment rate. Do not type the "%" sign, and round to two decimal places. Example: .0815 = 8.15% should be entered as 8.15
According to the Fisher equation, the real interest rate is given by a zero. b. the...
According to the Fisher equation, the real interest rate is given by a zero. b. the nominal interest rate plus the rate of inflation c. the nominal interest rate minus the rate of unemployment. d. the rate of economic growth. e. the nominal interest rate minus the rate of inflation An implication of sticky inflation is that, through monetary policy changes, the Federal Reserve a. has no impact on inflation b. can alter the real interest rate in the long...
Which of the following statements is TRUE about the rates of unemployment? Select one: O a....
Which of the following statements is TRUE about the rates of unemployment? Select one: O a. Cyclical unemployment can never exceed structural unemployment b. Frictional unemployment can never exceed structural unemployment O c. Cyclical unemployment can never exceed the natural rate of unemployment O d. Structural unemployment can never exceed seasonal unemployment O e. Frictional unemployment can never exceed the natural rate of unemployment
- 14. The natural rate of unemployment is the a, unemployment rate that would prevail with zero inflation. b. rate associated with the highest possible level of GDP. c. difference between the long-run and short-run unemployment rates. d. amount of unemployment that the economy normally experiences. 15. Suppose that the adult population in some country is 225 million. If 40 million are unemployed and 100 employed, then the unemployment rate is approximately a. 29% b.18% c. 24%. d. 6% 16....
With respect to GDP, how are transfer payments treated? Select one: :.00 O They are included in GDP because they represent income to individuals They are not included in GDP because taxes will have to be raised to pay for them O They are not included in GDP because they are not payments for currently produced goods or s ion They are included in GDP because the income will be spent for consumption. ous page ce Desk Support: 613-520-3700 or...
If unemployment is above the natural level of unemployment, which one of these statements MUST be true? Select one: O a. Employment must be below full employment O b. Cyclical unemployment must be negative o c. Real GDP must be above potential GDP d. The economy must be in an expansion e. The economy is experience a strong demand-pulled inflation
If the natural rate of unemployment is 6 percent, what is the
actual unemployment rate for this economy (use Okun’s law given
Y* = 29,000).
Actual unemployment rate: ?? %
Conslder the economy described by the following equations: C 1,500 + 8.9 (Y- T) P1808 T1,580 a. Complete the table shown below to find short-run equilibrium output. Conslder possible values for short-run equilibrlum output as they are given In the table below. Instructions: If you are entering any negative...
According to the Fisher equation, the real interest rate is given by a zero. b. the nominal interest rate plus the rate of inflation c. the nominal interest rate minus the rate of unemployment. d. the rate of economic growth. e. the nominal interest rate minus the rate of inflation An implication of sticky inflation is that, through monetary policy changes, the Federal Reserve a. has no impact on inflation b. can alter the real interest rate in the long...
Which of the following statements is TRUE about the rates of unemployment? Select one: O a. Cyclical unemployment can never exceed structural unemployment b. Frictional unemployment can never exceed structural unemployment O c. Cyclical unemployment can never exceed the natural rate of unemployment O d. Structural unemployment can never exceed seasonal unemployment O e. Frictional unemployment can never exceed the natural rate of unemployment
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