Exploring Macroeconomics
8th Edition
ISBN: 9781544337722
Author: Robert L. Sexton
Publisher: SAGE Publications, Inc
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Chapter 10, Problem 12P
To determine
To explain:
Whether the anticipated or unanticipated inflation depresses the growth of an economy and the reason for it.
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What do you believe is more of a problem towards long-term economic growth: persistent inflation or unemployment? justify your answer.
If a country is experiencing a relatively high rate of inflation, what impact will this have on the country’s long-term rate of economic growth?
How do I explain how changes in unemployment and inflation are related to changes in GDP growth? My answer will ultimately be specific to the 1980s.
Chapter 10 Solutions
Exploring Macroeconomics
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- How has real GDP growth performed recently? Does it suggest the economy is growing close to potential (or the steady state rate of growth)?arrow_forwardHow the monetary policy would be able to manage inflation while managing economic growth?arrow_forwardDoes the monetary policy have an impact on long term economic growth?arrow_forward
- if a country is experiencing a relatively high rate of inflation what impact will it have on long term economic growtharrow_forwardExplain why a fall in economic growth could lead to a rise in unemployment. Use a diagram to support your answer.arrow_forwardGovernor Mitch Daniels advocates that the government intervene less in business to promote jobs and ultimately economic growth. Instead, he argues to have government put factors in place that promote job growth such as lower taxes and more infrastructure. Is this an appropriate method to promote growth? Are there alternatives where the government can intervene that are more efficient than the market?arrow_forward
- Explain the different ways in which inequality can affect growth. Highlight any existing empirical evidence that you find interesting. Why?arrow_forwardHow do you determine a positive relationship between economic growth and unemployment.arrow_forwardWhy governments / decision makers try to achieve the stable economic growth and lower inflation? What are key problems which may be encountered when attempting to balance these two objectives?arrow_forward
- How can an increase in government spending boost economic growthand reduce unemployment in South Africa?arrow_forwardHow do interest rates affect economic growth? Which federal agency influences interest rates?arrow_forwardWhat is the impact of productivity growth on a nation's inflation rate or level?arrow_forward
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