Please discuss the impact of monetary policy tightening with regards to both unemployment and inflation with respect to both the short run and long run?

Answers

Answer 1
Answer:

Answer:

Explanation:

Monetary policy tightening decreases money supply and increases interest rate. Higher interest rate lowers investment, which will decrease aggregate demand. AD curve will shift to left, decreasing both price level and real GDP, giving rise to a recessionary gap in short run. Inflation will decrease and unemployment will increase.

In the long run, lower price level will decrease wages and prices of inputs, decreasing production costs. Firms will increase production, increasing aggregate supply. SRAS shifts rightward, intersecting new AD curve at further lower price level but restoring real GDP to potential GDP GDP.

When aggregate demand falls, AD curve will shift leftward from AD0 to AD1, intersecting SRAS0 at point B with lower price level P1 and lower real output Y1, with short run recessionary gap of (Y0 - Y1). In long run, SRAS0 shifts right to SRAS1, intersecting AD1 at point C with further lower price level P2 and restoring real GDP to potential GDP level Y0. Inflation will decrease and unemployment will decrease & restore to initial (full employment) level.


Related Questions

What additional regulatory measures do some state authorities demand if state funds are allocated to other government or nonprofit organizations?A. state government officials demand that the SEC should look into the financial dealings of all these organizationsB. state government officials recruit auditors to review the financial recordsC. state government officials themselves audit these organizations D. state government officials review the audit performed by CPA firms for such organizations
Identical products, as well as a large number of buyers and sellers, are characteristics of a market. In such markets, sellers of goods influence the prevailing market price, giving them the role of price in the market. True or False: The market for digital cable does not exhibit the two primary characteristics that define perfectly competitive markets.
9. Two countries: US and Mexico. Two goods: Airplane and car. A US worker's MPL is 20 times higher than a Mexican worker in making an airplane. A US worker's MPL is 5 times higher than a Mexican worker in making a car. Which country has absolute advantage in making cars and why
Many people have argued that the skills needed to be successful in today's workforce have changed. What skills do you feel an individual needs to be successful in a job today? Why do you feel these skills are most important?
A state government reported a $9,000 increase in net position in the motor pool internal service fund, a $12,000 increase in net position in the water enterprise fund, and a $7,000 increase in the employee pension fund. The motor pool internal service fund provides service primarily to the police department. What amount should the city report as the change in net position for business-type activities in its statement of activities?

QS 20-26A Merchandising: Cash payments for merchandise LO P4 Garda purchased $610,000 of merchandise in August and expects to purchase $730,000 in September. Merchandise purchases are paid as follows: 30% in the month of purchase and 70% in the following month. Compute cash payments for merchandise for September.

Answers

Answer:

The cash payments for September are $646000

Explanation:

The cash payments for merchandise are divided into to parts. The previous month's 70% payments and this month's 30% payments. Thus, the cash payments for the month of september will be 70% for AAugust purchases and 30% for september's purchases.

Thus the cash payments for merchandise will be,

Cash Payments = 0.7 * 610000 + 0.3 * 730000  = $646000

Answer:

=646000

Explanation:

30% pay in the month of purchase .

Note that th purchase made in September is $730,000 and 30% is due that month.

= 30% × 730,000

=  219,000

70% in the following month

For his category, payment be made in  September should relate to purchases made in August, and $610,000 was purchased in August

=70%× $610,000

=427,000

Cash payment f r te September

=  219,000 + 427,000

=$646,000

"A cleaning company uses $10 of chemicals, $40 of labor, and $5 of misc. expenses for each house it cleans. After some quality complaints, the company has decided to increase its use of chemicals by 50%. By what percentage has multifactor productivity fallen?

Answers

Answer:

multifactor productivity = 8.3%

Explanation:

given data

Total cost for chemicals = $10

Total cost of labor = $40

Total cost of misc = $5

use of chemical = 50%

solution

first we get here total initial cost that is

total initial cost  = 10 + 40 + 5

total initial cost = $55

and

Increase in cost of chemical is = 10 + (0.5) × (10)  

Increase in cost of chemical = 15

so Total increase in cost will be

Total increase in cost = $15 + $40 + $5

Total increase in cost = 60

so

increase in cost % = (initial\ cost)/(incresed\ cost)  × 100

increase in cost % = (55)/(60)  × 100  

increase in cost % = 91.67 %

so

change in multifactor productivity is  = 100% - 91.7%

multifactor productivity = 8.3%

An asset has had an arithmetic return of 10.3 percent and a geometric return of 8.3 percent over the last 90 years. What return would you estimate for this asset over the next 10 years? 25 years? 30 years?

Answers

Answer:

Blume's formula combines the geometric and arithmetic means of an asset to be able to predict its returns in a given period.

The formula is;

= Geometric Mean*(T-1)/(N-1) + Arithmatic Mean *(N-T)/(N-1)

Where;

T = Period in question

N = Total period

10 years

= 8.3%*(10-1)/(90-1) + 10.3%*(90-10)/(90-1)

= 10.1 %

25 years

= 8.3%*(25-1)/(90-1) + 10.3%*(90-25)/(90-1)

= 9.76%

30 years

= 8.3%*(30-1)/(90-1) + 10.3%*(90-30)/(90-1)

= 9.65%

When the seller does not give the buyer instructions concerning the disposal of the goods upon rejection and whether the goods are not perishable, the buyer: A. can resell the goods for the seller, but cannot keep a commission on the sale.
B. cannot reship them to the seller without the seller's instructions.
C. can resell them for the buyer's benefit.
D.can give reasonable time for the seller to reclaim the goods

Answers

Answer:

D

Explanation:

the buyer can give reasonable time for the seller to reclaim the goods and made a possible cure for the defective delivery.

A company has three products possible products that it can produce in a machine intensive production process. Capacity is constrained by the number of hours the machines can run during a period and the products are so popular that all units produced will be sold. Here is additional information:​ Product A Product B Product C
Contribution per unit $20 $30 $40
Machine hours per unit 2.5 3.25 4.5
Which of the following would be an accurate conclusion based on these facts?

A. Since Product C has the greatest contribution margin per unit and therefore emphasizing its production and sales will lead to the highest operating income in the short-run

B. Since A takes less time to produce, maximization of operating income will occur by emphasizing production and sales of A.

C. A balanced mix of 1/3 A, 1/3 B, and 1/3 C should be the goal when maximizing operating income in the short-run.

D. Product B should be emphasized if the goal is to maximize contribution margin.

Answers

Answer:

D

Explanation:

                                          A             B             C

Contribution per unit      20          30           40

Machine hours per unit  2.5          3.25       4.5

Contribution per hour     8             9.23       8.89

Product B has the highest contribution per hour .

It is stated that the capacity is constrained by the number of hours the machine can run during a period . and all products produce will be sold. This has made the machine hour the determinant factor in the situation.

Therefore product B should be emphasized if the goal is to maximize contribution margin.

Why do you think setting goals can influence an employee's safety-related actions in the workplace? Answer in 200 words

Answers

Answer:

Setting goals helps with knowing what to focus on and what to do at work

This helps the employee do better at work because they know exactly what they are going for

Explanation:

Just write a bunch of things about the things I said above like try to go into more detail about them I tried helping but I don’t think I can write 200 words worth of explanation on here

Answer:

well there realy inportant

Explanation:

Other Questions