Solve all this question......you will not solve all questions then I will give you down?? upvote. b. If the initial decrease in a component of aggregate expenditure was $500 Billion, the total size of the shift in the IS cu$500 billion.will bec. What outcomes result from the shift that occurs in the IS-MP framework?no change in real interest ratehigher real interest ratelower inflationboom equilibriumlower real interest rateObust equilibriumLno change in equilibrium outputno change in inflationhigher inflation Real interest rate5%4%3%2%1%0%-10%Shift the IS curve to the left until the new output gap is -5%.0%-5%Unexpected inflation(Inflation Inflation expectations)1%IIS curveMP curve5%Output gapPhillips curveAlter the interactive graph in order to witness how a leftward shift of the IS curve affects the output gap and unexpectedinflation. Use the information to forecast economic outcomes.a. Which of the following could explain the shift witnessed in the IS-MP framework and result in lower unexpectedinflation?Decreased consumer wealth stemming from depressed asset prices.Recent legislation that reduced taxes.Decreased business confidence recently revealed in a recent business confidence index estimate.An increase in financial market risk, leading to a negative output gap.Recent legislation that reduced government spending on infrastructure.

IS-MP curve i.e. Investment saving and monetary policy curve. This curve represents relationship…

5% 4% 3% 2% 1% 0% -10% Shift the IS curve to the left until the new output gap is -5%. 0% -5% Unexpected inflation (Inflation Inflation expectations) 1% 10% 1 HS curve MP curve 5% Output gap Phillips curve Alter the interactive graph in order to witness how a leftward shift of the IS curve affects the output gap and unexpected inflation. Use the information to forecast economic outcomes. a. Which of the following could explain the shift witnessed in the IS-MP framework and result in lower unexpected inflation? Decreased consumer wealth stemming from depressed asset prices. Recent legislation that reduced taxes. Decreased business confidence recently revealed in a recent business confidence index estimate. An increase in financial market risk, leading to a negative output gap. Recent legislation that reduced government spending on infrastructure.

5% 4% 3% 2% 1% 0% -10% Shift the IS curve to the left until the new output gap is -5%. 0% -5% Unexpected inflation (Inflation Inflation expectations) 1% 10% 1 HS curve MP curve 5% Output gap Phillips curve Alter the interactive graph in order to witness how a leftward shift of the IS curve affects the output gap and unexpected inflation. Use the information to forecast economic outcomes. a. Which of the following could explain the shift witnessed in the IS-MP framework and result in lower unexpected inflation? Decreased consumer wealth stemming from depressed asset prices. Recent legislation that reduced taxes. Decreased business confidence recently revealed in a recent business confidence index estimate. An increase in financial market risk, leading to a negative output gap. Recent legislation that reduced government spending on infrastructure.

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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