2. (a) Using your knowledge of the circular flow of income and interpreting the data given above, explain how changes in unemployment rate affected aggregate demand and aggregate supply. (b) Between 2007 and 2014, unemployment fell from 8.7% to 7.1%. Some argue that government attempts to reduce unemployment inevitably led to trade-offs with other macroeconomic policy objectives. Analyse the tables above and explain whether you agree or not.

2. (a) Using your knowledge of the circular flow of income and interpreting the data given above, explain how changes in unemployment rate affected aggregate demand and aggregate supply. (b) Between 2007 and 2014, unemployment fell from 8.7% to 7.1%. Some argue that government attempts to reduce unemployment inevitably led to trade-offs with other macroeconomic policy objectives. Analyse the tables above and explain whether you agree or not.

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter7: Unemployment And Inflation

Section: Chapter Questions

Problem 2.5P

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