Macroeconomics (7th Edition)
7th Edition
ISBN: 9780134738314
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Question
Chapter 13, Problem 13.2RDE
Sub part (a):
To determine
The effects of a positive supply shock.
Sub part (b):
To determine
The average inflation rate.
Sub part (c):
To determine
The effects of a positive supply shock.
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Explain what is the relationship between the consumer price index and the inflation rate.
The following table shows the average nominal interest rates on six-month Treasury bills between
2004 and 2008, which determined the nominal interest rate that the U.S. government paid when it
issued debt in those years. The table also shows the inflation rate for the years 2004 to 2008. (All
rates are rounded to the nearest tenth of a percent.)
Year
2004
INTEREST RATE (Percent)
2006
2007
2008
5.0
3.0
Source: "FRED Economic Data," Federal Reserve Bank of St. Louis, last modified
September 23, 2019, accessed September 24, 2019, https://fred.stlouisfed.org.
On the following graph, use the orange points (square symbol) to plot the nominal interest rates
for the years 2004 to 2008. Next, use the green points (triangle symbol) to plot the real interest
rates for those years.
28
1.0
2005
-16
-40
-40
Nominal Interest Rate Inflation Rate
(Percent)
1.6
2003
3.4
4.8
4.4
1.6
2004
2005
2006
2007
2008
(Percent)
27
3.4
3.2
2.9
3.8
2006
YEAR
Nominal Interest Rate
Real Interest Rate
(?)
According to…
The variable that connect the market of money and the market of goods via investment spending is: a The MPC b The interest rate c The MPS d The CPI
Chapter 13 Solutions
Macroeconomics (7th Edition)
Ch. 13 - Prob. 13.1.1RQCh. 13 - Prob. 13.1.2RQCh. 13 - Prob. 13.1.3RQCh. 13 - Prob. 13.1.4PACh. 13 - Prob. 13.1.5PACh. 13 - Prob. 13.1.6PACh. 13 - Prob. 13.1.7PACh. 13 - Prob. 13.1.8PACh. 13 - Prob. 13.1.9PACh. 13 - Prob. 13.1.10PA
Ch. 13 - Prob. 13.2.1RQCh. 13 - Prob. 13.2.2RQCh. 13 - Prob. 13.2.4RQCh. 13 - Prob. 13.2.5RQCh. 13 - Prob. 13.2.6PACh. 13 - Prob. 13.2.7PACh. 13 - Prob. 13.2.8PACh. 13 - Prob. 13.2.9PACh. 13 - An article in the Economist noted that the...Ch. 13 - Prob. 13.2.11PACh. 13 - Prob. 13.2.12PACh. 13 - Prob. 13.2.13PACh. 13 - Prob. 13.2.14PACh. 13 - Prob. 13.2.15PACh. 13 - Prob. 13.3.1RQCh. 13 - Prob. 13.3.2RQCh. 13 - Prob. 13.3.3RQCh. 13 - Prob. 13.3.4PACh. 13 - Prob. 13.3.5PACh. 13 - Prob. 13.3.6PACh. 13 - Prob. 13.3.7PACh. 13 - Prob. 13.3.8PACh. 13 - Prob. 13.3.9PACh. 13 - Prob. 13.3.10PACh. 13 - Prob. 13.4.1RQCh. 13 - Prob. 13.4.2RQCh. 13 - Prob. 13.4.3RQCh. 13 - Prob. 13.4.4PACh. 13 - Prob. 13.4.5PACh. 13 - Prob. 13.4.6PACh. 13 - Prob. 13.4.7PACh. 13 - Prob. 13.4.8PACh. 13 - Prob. 13.4.9PACh. 13 - Prob. 13.4.10PACh. 13 - Prob. 13.2RDECh. 13 - Prob. 13.1CTECh. 13 - Prob. 13.2CTE
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