How could central bank achieve goal in short run
Course:- Macroeconomics
Reference No.:- EM13204781

Expertsmind Rated 4.9 / 5 based on 47215 reviews.
Review Site
Assignment Help >> Macroeconomics

An economy is in long-run macroeconomic equilibrium with an unemployment rate of 5% when the government passes a law requiring the central bank to use monetary policy to lower the unemployment rate to 3% and keep it there. How could the central bank achieve this goal in the short run? What would happen in the long run.

Put your comment

Ask Question & Get Answers from Experts
Browse some more (Macroeconomics) Materials
Above are the annual average NO2 concentrations at sites in downtown Boston and Los Angeles. What are the sources of NO2 in the urban atmosphere? Why is there a decreasing tre
Mike suffered some injuries during the robbery and filed suit against Produce Market for not maintaining a secure environment for its customers. In an out-of-court settlement
In a few weeks Professor Smith will be taking his daughter Attilla to the State Fair. Calculate the Marginal Rate of Substitution (MRS).
A producer in a perfectly competitive industry has a cost function described by TC(q)=1000+6q+0.2q^2. If the market price is 40 and it has already committed to paying the fi
If preset prices turn out to be below the equilibrium prices, shortages occur and scalping in legal or illegal secondary markets arises. The prices in the secondary market t
Why is an increase in the number of varieties of a good regarded as a gain from trade? Can you think of economic disadvantages associated with greater product variety? Expla
Mort'sOstrich Farm produces high-protein, low-fat ostrich meat forrestaurants and consumers. Mort's currently supplies a small numberof customers, but the firm believes it c
What is the unemployment rate in Afghanistan? What types of businesses do the drug merchants use to launder opium cash? What did the Taliban teach here cab driver Jalal to do?