Business, 11.04.2020 02:49 shestheone715
Suppose the economy has a natural rate of unemployment of 6%.
a. Suppose short-run output over the next 4 years is +1%, 0%, -1%, and -2%, According to Okun's law, what unemployment rates would we expect to see in this economy?
b. Consider another economy in which the unemployment rate over the next 3 years is 6%, 7%, and then 4%. According to Okun's law, what are the levels of short-run output(Y~) in this economy?
Okun's Law -- u - u- = -1/2 x Y~
u -- current rate of unemployment
u- -- natural rate of unemployment
Y~ -- short run output.
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Suppose the economy has a natural rate of unemployment of 6%.
a. Suppose short-run output ove...
a. Suppose short-run output ove...
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