In the IS‑LM framework with flexible prices, how does a fall in the price level affect the equilibrium interest rate and output?
2
Which of the following best describes the short‑run aggregate supply curve when nominal wages are rigid?
3
A permanent increase in government spending shifts which curves in the IS‑LM‑DG model, and what is the net effect on the price level?
4
According to the text, what is the NAWRU and what does it signify for wage dynamics?
5
If the nominal wage rate rises while prices are perfectly flexible in the long run, what is the predicted effect on aggregate supply?
6
Which mechanism explains why a decrease in the price level raises real money balances and thus stimulates investment?
7
In the context of the Phillips curve with expectations, what role does the term μ play?
8
How does a rise in the tax rate affect the IS curve and the resulting equilibrium output, assuming all else equal?
9
According to Okun’s law, what is the expected change in the unemployment rate if real GDP falls 3 % below potential and the Okun coefficient θ equals 0.5?
10
When nominal wages increase while prices are flexible, why does the long‑run aggregate supply curve stay vertical according to the text?
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