b. Why do some people say thát inflation is a tax? Who pays that tax? Whg collects that tax? How does it work exactly? Does your answer depend on whether the world is best described by a general equilibrium (Classic economics) or disequilibrium (Keynesian)? c. Economists say that, in response to a wage rate increase, the overall labor supply may increase, decrease or remain unchained. Why aren't economists more certain about the consequences of something as simpl as a wage increase? d. The introduction of the ATM machine led to a period of price level increases. Why? Explain your answer intuitively.

b. Why do some people say thát inflation is a tax? Who pays that tax? Whg collects that tax? How does it work exactly? Does your answer depend on whether the world is best described by a general equilibrium (Classic economics) or disequilibrium (Keynesian)? c. Economists say that, in response to a wage rate increase, the overall labor supply may increase, decrease or remain unchained. Why aren't economists more certain about the consequences of something as simpl as a wage increase? d. The introduction of the ATM machine led to a period of price level increases. Why? Explain your answer intuitively.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter25: The Keynesian Perspective

Section: Chapter Questions

Problem 2SCQ: In a Keynesian framework, using an AD/AS diagram, which of the following government policy choices...

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Similar questions

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