happens when firms and workers underestimate future prices in the economy. what would happen to actual output as opposed to the expected potential output.
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describe what happens when firms and workers underestimate future prices in the economy. what would happen to actual output as opposed to the expected potential output.
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- What happens when firms and workers underestimate future prices in the economy? Explain the answer while focusing on what would happen to actual output as opposed to the expected potential output.In your own words, describe what happens when firms and workers underestimate future prices in the economy. Focus your answer on what would happen to actual output as opposed to the expected potential output.What happens when firms and workers underestimate future prices in the economy? Focus your answer on what would happen to actual output as opposed to the expected potential output. (Course is macroeconomics).
- The economy of a hypothetical country has been stable for two or three years with very low unemployment. Wages have been gradually increasing during this time. Now stock market prices begin significant increases, causing peoples’ investments, such as their retirement accounts and other investments to increase in value. People feel very good about the future, that they will keep their jobs, get regular pay raises and life will be good. With this positive feeling, people feel better about making purchases that perhaps they had been delaying earlier. They now use their new-found sense of wealth to buy many things that they had been hesitant to purchase in the past. Given this scenario, insert your answers below each of the following questions. What kind of economic gap will start to occur (inflationary or recessionary)? Which of these graphs, Figure 1 or Figure 2, depicts this economic gap? What part of the Federal Reserve’s congressional mandate does this scenario trigger (price…The economy of a hypothetical country has been stable for two or three years with very low unemployment. Wages have been gradually increasing during this time. Now stock market prices begin significant increases, causing peoples’ investments, such as their retirement accounts and other investments to increase in value. People feel very good about the future, that they will keep their jobs, get regular pay raises and life will be good. With this positive feeling, people feel better about making purchases that perhaps they had been delaying earlier. They now use their new-found sense of wealth to buy many things that they had been hesitant to purchase in the past. What kind of economic gap will start to occur (inflationary or recessionary)? What part of the Federal Reserve’s congressional mandate does this scenario trigger (price stability and maximum sustainable employment)? What kind of monetary policy might be helpful to stabilize the economy (expansionary or contractionary)? What…The economy of a hypothetical country has been stable for two or three years with very low unemployment. Wages have been gradually increasing during this time. Now stock market prices begin significant increases, causing peoples’ investments, such as their retirement accounts and other investments to increase in value. People feel very good about the future, that they will keep their jobs, get regular pay raises and life will be good. With this positive feeling, people feel better about making purchases that perhaps they had been delaying earlier. They now use their new-found sense of wealth to buy many things that they had been hesitant to purchase in the past. Given this scenario, insert your answers below each of the following questions. What kind of economic gap will start to occur (inflationary or recessionary)? Will the demand shift to the right or left? What part of the Federal Reserve’s congressional mandate does this scenario trigger (price stability and maximum sustainable…
- How Many decisions in business and economics require quantitative estimates? why ?The economy of a hypothetical country has been stable for two or three years with very low unemployment. Wages have been gradually increasing during this time. Now stock market prices begin significant increases, causing peoples’ investments, such as their retirement accounts and other investments to increase in value. People feel very good about the future, that they will keep their jobs, get regular pay raises and life will be good. With this positive feeling, people feel better about making purchases that perhaps they had been delaying earlier. They now use their new-found sense of wealth to buy many things that they had been hesitant to purchase in the past. Given this scenario, insert your answers below each of the following questions What kind of monetary policy might be helpful to stabilize the economy (expansionary or contractionary)What specific monetary policy tools does the Federal Reserve have available to use in this scenario? What specific monetary policy tools does…If markets do not self-adjust, how can a decline in spending lead to a negative process that ruins an economy?
- The government decides that it will cut taxes in an attempt to move the economy out of a severe recessionConsumers expect an increase in the future price of a good, then neither demand nor supply will shift. current demand will increase (shift rightward). current demand will decrease (shift leftward). current supply will increase (shift rightward).Planned economies do not have prices. True False