ONLY G and E Please! I put the other page on there with A-D only for reference to the economic situation. An economy is currently in a recession.inflatinLRPC(a) Draw a single correctly labeled graph with both the short-run and long-run Phillips curves. Label thecurrent short-run equilibrium as point X.NameSRPCUnemployment.(b) Is the expected inflation rate greater than, less than, or equal to the actual inflationrate? The expected inflation rate will beless than the actual inflahenrate(c) Will borrowers with fixed-rate loans benefit from the situation that you identified in part (b)?Explain. Borrowers with fixed rate loans will benefit from such situation...because the value of the iman will decrease with a lower Inflaten rale(d) Assume the government budget is balanced. In the absence of any discretionary policy action, willthe government budget move into surplus, deficit, or remain in balance?Explain. The government budget will remain in balance in the absence of-any discretionary policy.(e) On your graph in part (a), show how the economy will adjust in the long run in the absence of anydiscretionary policy action.(f) Now assume instead the government increases spending without changing taxes to close therecessionary gap. What effect will this policy have on the nationaldebt?An increase in government spending without changing faxes willcause the national debt to increase An economy is currently in a recession.inflatinLRPC(a) Draw a single correctly labeled graph with both the short-run and long-run Phillips curves. Label thecurrent short-run equilibrium as point X.NameSRPCUnemployment.(b) Is the expected inflation rate greater than, less than, or equal to the actual inflationrate? The expected inflation rate will beless than the actual inflahenrate(c) Will borrowers with fixed-rate loans benefit from the situation that you identified in part (b)?Explain. Borrowers with fixed rate loans will benefit from such situation...because the value of the iman will decrease with a lower Inflaten rale(d) Assume the government budget is balanced. In the absence of any discretionary policy action, willthe government budget move into surplus, deficit, or remain in balance?Explain. The government budget will remain in balance in the absence of-any discretionary policy.(e) On your graph in part (a), show how the economy will adjust in the long run in the absence of anydiscretionary policy action.(f) Now assume instead the government increases spending without changing taxes to close therecessionary gap. What effect will this policy have on the nationaldebt?An increase in government spending without changing faxes willcause the national debt to increase

G. The loanable funds market is a macroeconomic concept that illustrates how borrowers and lenders…

(g) Draw a correctly labeled graph of the loanable funds market and show the effect of the change in the national debt on the equilibrium real interest rate. (h) Based on the change in the equilibrium real interest rate identified in part (g), what will happen to economic growth in the country in the long run? Explain.

(g) Draw a correctly labeled graph of the loanable funds market and show the effect of the change in the national debt on the equilibrium real interest rate. (h) Based on the change in the equilibrium real interest rate identified in part (g), what will happen to economic growth in the country in the long run? Explain.

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter17: The Short-run Trade-off Between Inflation And Unemployment

Section: Chapter Questions

Problem 5CQQ

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Similar questions

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Suppose the public believes that a newly announcedanti-inflation program will work and so lowers itsexpectations of future inflation. What will happen toaggregate output and the inflation rate in the short run?
3. a) Using AD-AS model, explain how a negative demand shock due to COVID 19 will affect the economy in the short run and long run (Show short run and long run adjustment in a single diagram). b) Derive the equation of Expectation Augmented Phillips curve using standard equation of Aggregate Supply (AS) and explain causes of inflation in terms of it. How does expectation augmented Phillips curve explain Stagflation?
(a) What events of the 1970s and 1980s made economists believe that the shortrun relationship between inflation and unemployment was unstable (not fixed and permanent)? (b) Explain, using a diagram(s) and the concept of stagflation, the relationship between shifts in the SRAS curve and the position of the short-run Phillips curve.
An economy's aggregate demand curve (the relationship between short-run equilibrium output and inflation) is described by the equation:Y = 15,000 - 12,000π, where π is the inflation rate. Initially, the inflation rate is 2 percent or π = 0.02. Potential output Yp equals 14,640.Note: Keep as much precision as possible during your calculations. Your final answer for inflation should be accurate to at least two decimal places and output should be accurate to the nearest whole number.a) Find inflation and output in short-run equilibrium. Inflation : 0%Output : $0 b) Find inflation and output in long-run equilibrium. Inflation : 0%Output : $0
Suppose that an economy has a phillips curve π=π₋₁ -0.5(u-0.08) a) what is the natural rate of unemployement? b) how much cyclical unemployment is necessary to reduce inflation by 5% points? using okun's Law, compute the sacrifice ratio. c) inflation is runnuing 10%. the fed wants to reduce it to 5%. give two scenarios that will achieve that goal.
Suppose the Federal Reserve announced that itWould pursue contractionary monetary policy toReduce the inflation rate. Would the followingConditions make the ensuing recession more or lessSevere? Explain.A. Wage contracts have short durations.B. There is little confidence in the Fed’s determinationTo reduce inflation.C. Expectations of inflation adjust quickly to actualInflation
“Households decide to save a larger share of their income will shift aggregatedemand curve upward because higher saving will boost investment which inturn increase the demand for investment goods.” Do you agree with thestatement? Explain your choice. e. Graphically derive short run Phillips curve with the help of aggregate demand and supply model.
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