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Q2: Continuing from Question 1: What will be theshape of the Phillips Curve because of the policythat you selected in Step 2 (of Question 1)? Why?Please explain in detail.•You should answer each step in the following the answer 2 table.

Please solve asap...........?

Suppose that = 1° , and the Phillips curve equation for the economy is below: T = 4.5% - 0.2u, If inflation (T,) is 3.5%, then u, is 22.5 %. v tend to decrease If the actual unemployment rate in this economy is equal to 6%, the rate of inflation wi tend to increase be zero remain constant

Question 16 In the Phillips Curve diagram below, the economy is currently at its non- accelerating inflation rate of unemployment with an inflation rate of L. Inflation (%) ABCD L M 0 S LRPC SRPC2 SRPC1 NAIRU T Unemployment (%) Which one of the following is least likely to reduce the non-accelerating inflation rate of unemployment? Measures to increase the mobility of labour Measures to improve the availability of job information An increase in spending on education and training A rise in aggregate demand

15. Suppose that the relationship between inflation rate (x) and unemployment rate (u) is described by the following equation: H, - n = (m + z) – au, where m = 0.05, z = 0.04, and a = 2. In this economy, the authorities keep unemployment rate at 4% forever. a. If the modified Phillips curve describes the relationship between a and u correctly, how should "x,*" be specified? Rewrite the equation using this specification. And assuming that 7-1= 1%, compute Af, T4+1, and x4+2. b. Derive the natural rate of unemployment.

The equation of the Phillips curve from 1970 to 1995 is: -17.4-1.2u₁. The natural rate of unemployment using this curve is 6.2%. (round your answer to one decimal place) The equation of the Phillips curve from 1996 to 2018 is: x=2.8% -0.16+ Which of the following explains why the natural rate of unemployment cannot immediately be calculated from the Philips curve? A. The expression only provides Ⓡ and a. B. The equation does not include a specific value for expected inflation. C. The expression only provides (m + z) and . D. None of the above. Using the line drawing tool, accurately graph the Phillips relation=2.8% -0.16 with inflation on the vertical axis and unemployment on the horizontal axis. Carefully follow the instructions above and only draw the required object. What is the natural rate of unemployment using the relation = 2.8% -0.16u, under the assumption that the value of x=2% The natural rate of unemployment fell to 5% between 1970-1995 and 1996-2018? (round your answer to…

Suppose the Phillips curve is given by the following: 2ut It Where: π = Tt-1 Suppose πt-1 = 0; at year t, authorities decide to keep unemployment rate at 4% forever. a. Compute the rate of inflation for years t+1, t+2 and t+3. b. Suppose half of labor contract of workers has been indexed. What is the new equation for the Phillips curve? Compute the rate of inflation for years t+1, t+2 and t+3. i. π = 0.1 ii. iii. Compared to your answers in problem (a), what can you conclude?

1. Suppose the Phillips curve is represented by the following equation: a, - 1, = 0.2– 2u,. Given this information, we know that the natural rate of unemployment in this economy is 2. In the following production function, Y = f(K, NA), a 20% increase in A will cause _ (labor / effective labor / output / output per worker) to increase by 20%?

The following graph plots the long-run Phillips curve (LRPC) and short-run Phillips curve (SRPC₁) for an economy currently experiencing long-run equilibrium at point A (grey star symbol). INFLATION RATE (Percent) 7 6 1 0 0 SRPC 1 2 3 5 6 UNEMPLOYMENT RATE (Percent) LRPC 4 Which of the following is true along SRPC₁? O The natural rate of unemployment is 3%. O The expected inflation rate is 5%. O The actual unemployment rate is 6%. O The actual inflation rate is 5%. 7 8 + 00 SRPC₂ D C

. Assume that the economy experiences no change in productivity, money demand or its natural rate of unemployment in either the short or long run. The inflation rate responds immediately to correspond to the money supply growth rate. However, wage inflation adjusts to changes in the inflation rate with a time lag. Draw a diagram with inflation on the vertical axis and the unemployment rate on the horizontal axis that illustrates the Phillips curve relationship in the short run. Label the curve as PC1. Mark a point N on the horizontal axis that represents the natural rate of unemployment

a and b

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answer only part d , e and f

The Phillips Curve is given as; n = T° + (m + z) – au Now, consider the case where the inflation expectations are de-anchored. Assume the expected inflation n° is based on last year's inflation rate t-1 (nº = Ttt-1) 1.1: Suppose Tt-1 = 3%. What would be the unemployment rate (U¿) when T = 4%? %3D 1.2: Suppose the production function is given by: Y = N = L(1 – uz) What happens to the potential output when the markup increases?

1. Assume that the South African economy is at equilibrium where output is equal to the natural level of output. Now suppose there is an increase in unemployment benefits in the country. Use the IC-LM-PC model to graphically illustrate the effects of an increase in unemployment benefits on the labor market (the WS and PS curves), the goods and money markets (the IS and LM curves) and on the Phillips curve. In your answer illustrate the differences in what happens to output, inflation and real interest rate between the short-run (SR) and medium-run (MR).

Pls help with below homework. Select the correct option and explain it in 7-8 sentences.

For each of the following scenarios, illustrate the effects of the development on both the short-run and long- run Phillips curves (SRPC and LRPC respectively). Plz show a colored graph so I can see if I moved them to the right positions For each of the following scenarios, illustrate the effects of the development on both the short-run and long-rum Phillips curves (SRPC and LRPC, respectively) There is a fall in the natural rate of unemployment. LRPC Unemployment Rate SRPC There is an advance in technology that makes production more efficient. There is a decrease in taxes. LRPC Unemployment Rate SAPC SRPC LRPC SAPC ° Movement along SRPC LRPC LRPC SRPC

Assume that the unemployment rate rises. What is the impact on the short run Phillips curve? O It will shift up. O There will be movement along the curve to the left. O There will be movement along the curve to the right. OIt will shift down. Show Transcribed Text The following equations describes an economy: Y=C+I+G+ NX C = 250 +0.7*(1-t)Y t = 0.2 1 = 300 G = 60 NX = 40 Which of the following statements is true? O If exports increase by 10, equilibrium Y will increase by 33. O Without any changes, the equilibrium level of Y is 2167. O If government spending increases by 40, equilibrium Y will increase by 46.51. The value of the government spending multiplier is 2.27. Show Transcribed Text

The figure on the right shows the average monthly flows (in millions) between employment, unemployment, and non-participation for a hypothetical economy. According to the figure, the proportion of unemployed workers finding jobs in an average month is %. (Round your response to one decimal place.) U.S. data covering the 1996-2014 period show that the proportion of unemployed workers finding jobs has O A. an indeterminate relationship with the unemployment rate. OB. a strong inverse relationship with the unemployment rate. OC. a weak inverse relationship with the unemployment rate. OD. a strong positive relationship with the unemployment rate. Employment 165.8 million 1.9 4.7 2.6 1.7 5.3 Unemployment Out of the labor force 7.7 million 2.0 77.1 million G

Assume that the cconomy of Country X his an actual unemployment rate of 7%, a natural rate of unemployment of 5%, and an inflation rate of 3%. Using the numerical values given above, draw a correctly labeled graph of the short-run and long-run Phillips curves. Label the current short-run equilibrium as point B. Plot the numerical values above onthe graph. Assume that the government of Country X takes no policy action to reduce unemployment. In the long run, will each of the following shill to the right, shift to the left, or remain the same? (i) Short-run aggregate supply curve. Explain. (ii) Long-run Phillips curve Identify a fiscal policy action that could be used to reduce the unemployment rate in the short run. Draw a correctly labeled graph of aggregate demand and short-run aggregate supply, and show the impact on the equilibrium price level and real gross domestic product (GDP) of the fiscal policy action identified

Suppose the Phillips curve is given by the following: πt = π² + (µ+z) aut πι = π + 0.1 Where: π = πt-1 Suppose initially, 0 = 0 a. What is the natural rate of unemployment? 2ut b. Suppose ut = Un. In year t, government authorities decide to bring the unemployment rate down to 3% and hold it there forever. Determine the rate of inflation in years t, t+1, t+2. c. Suppose in year t+5,0 increases from 0 to 1 and ut = 3%. Determine the rate of inflation in year 5 and year 6.

According to the St. Louis Federal Reserve the natural unemployment rate is 4.44 percent (Q2 2022 B) and the U.S. Bureau of Labor Statistics (BLS) estimates the U.S. unemployment rate (U3, March 2022 ) to be 3.6 percent. If you expect unemployment to continue to fall the short-run Phillips curve would predict: O A decrease in the inflation rate. An increase in the inflation rate. A decrease in the unemployment rate. An increase in the unemployment rate.

Just the question in red brackets please thanks!

2. Suppose we have an economy with Phillips curve T^e = t + (m + z) – au. Recall the price setting equation P = (1+m)W = (1+m)P^eF(u,z) = (1+m)P^e(1-au+z) Suppose a = 1/5 , m = z = 1/20 . a) Calculate the natural rate of unemployment. b) Now suppose that half of the working population has its wages indexed - that is, they have a constant real wage w. Derive the new Phillips curve in this economy. (Hint: first work out what the function F looks like for workers with indexed wages, then average this with the original F. You should end up with a function that looks like F *(u,z) = 1-a^*u+z^* - then plug the values of a, z, m into the equation for the Phillips curve.) c) What's the new natural rate of unemployment? Is it higher or lower than before?

q10

Consider the Friedman-Phelps model of the Phillips Curve as discussed in lecture. Assume the economy is currently at Y-full employment. When the Fed sells government securities to the public, and there are no other exogenous shocks to the economy, which one of the following is predicted to happen? The actual inflation rate increases, and the unemployment rate increases permanently. O The actual inflation rate increases, and the unemployment rate increases first and then gradually goes back to the natural rate of unemployment. O The actual inflation rate decreases, and the unemployment rate increases first and then gradually goes back to the natural rate of unemployment. The actual inflation rate decreases, and the unemployment rate increases permanently. The actual inflation rate decreases, and the unemployment rate decreases first and then gradually goes back to the natural rate of unemployment.

Why does this mean? "the natural rate of unemployment" and also can elaborate more on why the longrun philips curve is vertical at the rate? why inflation is also constant in longrun equillibrium?

Suppose that for years East Confetti's short-run Phillips Curve was such that each 1 percentage point increase in its unemployment rate was associated with a 4 percentage point decline in its inflation rate. Then, during several recent years, the short-run pattern changed such that its inflation rate rose by 3 percentage points for every 1 percentage point drop in its unemployment rate. Graphically, did East Confetti's Phillips Curve shift upward or did it shift downward? |(Click to select) V

Starting from any point in the Phillips curve shown in Figure 12.5, an increase in short-run output would be represented by a move from: Figure 12.5: Phillips Curve AR a to point b. a to point c. Ob to point c. c to point b b to point a C a 0 PC₁ PC₂

1. Suppose the Phillips curve is represented by the following equation: " -1.- -10 - 2u, . Given this information, we know that the natural rate of unemployment in this economy is %.

Consider the Efficiency Wage story. Suppose we had several periods of 0 inflation.   Let ST represent the total supply of labor; SNS the supply of non-shirking (not lazy) workers, and SShrk the number of shirking (lazy) workers. Suppose we had several periods of 0% inflation. Then if we had an increase in Aggregate Demand that caused an increase in the Aggregate Price level, we would see which of the following in the short run? Group of answer choices a) higher inflation and lower unemployment. b) None of the other options. c) lower inflation (which would be deflation given our premise) and higher unemployment. d) higher inflation and higher unemployment. e) lower inflation (which would be deflation given our premise) and lower unemployment.

The Philips curve in the late 20th century

5. Suppose an economy is characterized by the equations below: Price setting: P= (1+ mXW/A) Wage setting: W = A°P° (1 – u) Write down an expression for the equilibrium unemployment rate if P = P but A does not necessarily equal A. Now suppose that expectations of both prices and productivity are accurate. If the markup (m) is equal to 5%, the natural rate of unemployment is