Question

In: Economics

Assume that there is an increase in the labor productivity in an economy. What will happen...

  1. Assume that there is an increase in the labor productivity in an economy. What will happen to the LRAS? Show it graphically using the labor market and the production function and explain.
  2. Assume that there is an increase in population in an economy. (for example, migration) What will happen to the LRAS? Show it graphically using the labor market and the production function and explain.

  3. AD-AS and Phillip Curve Model, Money Market and Banking System

    1. Why does the aggregate demand curve have a negative slope?

    2. Why is the long run aggregate supply curve vertical?

    3. Why does the short run aggregate supply curve have a positive slope?

    4. Graphically illustrate an economy in the long run equilibrium, producing at the full employment level of production. Indicate the equilibrium Price level (P*) and the level of real GDP (Y*)

Solutions

Expert Solution

Rahul Sunny answered 5 months ago
Next > < Previous

Related Solutions

For an economy to grow it must increase labor, capital and/or productivity. While there are diminishing...
For an economy to grow it must increase labor, capital and/or productivity. While there are diminishing returns to capital and labor, growth from productivity is unlimited. Governments have a role in providing the framework for sound economic growth. This includes having sound fiscal and monetary policy. Other factors that encourage GDP growth are reasonable taxes and regulation, low corruption, and openness to trade and foreign direct investment. For this assignment you will write a paper analyzing the growth of a...
For an economy to grow it must increase labor, capital and/or productivity. While there are diminishing...
For an economy to grow it must increase labor, capital and/or productivity. While there are diminishing returns to capital and labor, growth from productivity is unlimited. Governments have a role in providing the framework for sound economic growth. This includes having sound fiscal and monetary policy. Other factors that encourage GDP growth are reasonable taxes and regulation, low corruption, and openness to trade and foreign direct investment. For this assignment you will write a paper analyzing the growth of a...
How is labor productivity measured? What is the trend in labor productivity? How is labor productivity...
How is labor productivity measured? What is the trend in labor productivity? How is labor productivity related to economic growth? What helps and what hurts labor productivity? Can labor productivity keep growing forever?
Assume there is a temporary increase in oil prices. a) What will happen to the price...
Assume there is a temporary increase in oil prices. a) What will happen to the price level, unemployment, and output when the oil prices increased in the short-run? Show it on a graph. b) Now suppose the government does not intervene? How will the economy adjust in the long-run? Explain. c) Now suppose the government decided to intervene. What can be done? Give one example of fiscal policy and one example of monetary policy with the reasoning behind them? How...
Explain how an increase in technology, which increases the productivity of labor, will affect the labor...
Explain how an increase in technology, which increases the productivity of labor, will affect the labor market, the production function, and aggregate output. Provide graphs to illustrate.
Assume that an increase in government expenditure causes a larger budget deficit. Explain what will happen...
Assume that an increase in government expenditure causes a larger budget deficit. Explain what will happen to the DD curve as a result. Explain what will happen to the AA curve as a result. Answer with graphs.
Present an analysis that shows how an increase in labor productivity (perhaps from more investment or...
Present an analysis that shows how an increase in labor productivity (perhaps from more investment or perhaps from improved technology) will tend to impact the economy. Identify which of your results fit what we actually observe for the U.S. economy over time. Complete your answer to this question by identifying one economic policy you think will help enhance labor productivity. (15 points)
1. An increase in saving that leads to more capital accumulation ________ labor productivity. decreases increases...
1. An increase in saving that leads to more capital accumulation ________ labor productivity. decreases increases does not change probably changes but in an ambiguous direction 2. In 2010, of the following ________ had the highest real GDP per person. the Europe Big 4 countries the United States Canada Japan 3. Moving along the aggregate production function shows the relationship between ________, holding all else constant. capital input and real GDP labor input, capital input and real GDP technology and...
Assume a small open economy initially in equilibrium and experiencing a trade deficit. What would happen...
Assume a small open economy initially in equilibrium and experiencing a trade deficit. What would happen to the real interest rate, desired levels of saving and investment, and the net capital inflows if business investment were to increase? Answer this question with the help of a graph.
how to measure physical capital, labor productivity, and human capital for an economy like Switzerland. and...
how to measure physical capital, labor productivity, and human capital for an economy like Switzerland. and how can we tell which one has been the main contributor to the growth and why?. explain properly how you measure it.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT