Suppose the U.S. economy was at trend and now benefits from a boom in Asia, which raises ez by 0.015. All other demand parameters remain unchanged. In order to maintain Ÿ₁ = 0, the Federal Reserve raises the real interest rate R by 0.6 percentage point. Based on this information you know that b =

When interest rates increase, we expect the supply curve for large durable goods to shift upwards. True False

Hello! please can you solve question B? Thanks

Consider a small macroeconomy located near the South Pacific Ocean where the current interest rate is 15 percent and the potential level of real GDP equal to $2.7 billion. Consumers spending behavior is described by the equation: C = 175 + 0.8DI, while firm's investment spending behavior is described by the equation: 1 = 60 +0.25Y-750r. Trade is allowed and currently, total exports is fixed at $150 million while total imports is described by the equation: IM = 320 + 0.1Y. The government's spending is fixed at $840 million and net taxes is described by the equation: T=50 +0.25Y. (Question 4 of 6) Consider that actual rate of unemployment is 5 percent and the current government implements a monetary policy to stabilize the current economic environment. Given the government's policy, what will be the new equilibrium level of GDP (in millions of dollars)? (report your answer at 2 decimal places)

Describe the emphasis that the neoclassical perspective takes on the macroeconomy, relative to the Keynesian perspective (Chapter 12).  Discuss the importance of capital per person and the role of flexible prices in their perspective.  What role do rational or adaptive expectations play in flexible prices? (13.1)