Suppose, initially the Australian economy is atfull employment(in other words the economy is atthe potential GDP). Using AD-AS model, explain how would each of the following events aectthe economy both in the immediate and in the long term. a) A slowdown in China’s economic growth due to the sub-prime crisis in the US. b) Union wage settlements push the wage rate up. c) An increase in consumer confidence.
Suppose, initially the Australian economy is atfull employment(in other words the economy is atthe potential GDP). Using AD-AS model, explain how would each of the following events aectthe economy both in the immediate and in the long term. a) A slowdown in China’s economic growth due to the sub-prime crisis in the US. b) Union wage settlements push the wage rate up. c) An increase in consumer confidence.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter24: The Aggregate Demand/aggregate Supply Model
Section: Chapter Questions
Problem 43CTQ: Economists expect that as the labor market continues to tighten going into the latter part of 2015...
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Suppose, initially the Australian economy is atfull employment(in other words the economy is atthe potential
immediate and in the long term.
a) A slowdown in China’s
b) Union wage settlements push the wage rate up.
c) An increase in consumer confidence.
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