For parts (a) and (b) assume that the following information applies to an economy: • the nominal wage rate in the economy is $24 per hour ⚫ the aggregate price level is $8.⚫ there is a 90% employment rate. (b) Using a wage-setting curve, show the effect of a 50% reduction in the aggregate price level on the unemployment rate in the economy. On your diagram you will also need to indicate the total labour force for the economy (ESSAY FORM PLEASE THANKS)

For parts (a) and (b) assume that the following information applies to an economy: • the nominal wage rate in the economy is $24 per hour ⚫ the aggregate price level is $8.⚫ there is a 90% employment rate. (b) Using a wage-setting curve, show the effect of a 50% reduction in the aggregate price level on the unemployment rate in the economy. On your diagram you will also need to indicate the total labour force for the economy (ESSAY FORM PLEASE THANKS)

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter21: Unemployment

Section: Chapter Questions

Problem 11RQ: If you an? out of school but working part time, are you considered employed or unemployed in U.S....

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