Reference no: EM131118629
In 1958, A.W. Phillips stated that inflation and unemployment are correlated. In 1972, Milton Friedman stated that Phillips' relationship was only temporary, and thus only applicable in the short-run. Friedman contended that people will over time anticipate the correct value of inflation and in the meantime adjust their actions accordingly. These expectations mitigate policymakers' attempts to control unemployment through inflationary policies. Thus, Friedman believed that in the long-run, there is no relationship between inflation and unemployment. Friedman's analysis of inflation and unemployment is summarized by the following equation: equation , where a is a positive constant, and the natural rate of unemployment is the normal unemployment that an economy experiences because people are continually quitting and searching for jobs.
Which of the answer choices is Phillips' theory regarding inflation and unemployment?
A. More people working in an economy correlates to more expensive goods and services.
B. Fewer people looking for work in an economy correlates to cheaper goods and services.
C. More people looking for work in an economy correlates to more expensive goods and services.
D. Fewer people working in an economy correlates to more expensive goods and services.
At the end of 2014, the unemployment rate in the U.S. was 5%. The Federal Reserve has stated that it will conduct monetary policy to bring down this unemployment rate during 2015. Suppose that the natural rate of unemployment is 6%, the value of a is one, and the public expects inflation of 4%. According to the given information, which of the answer choices correctly gives values of actual inflation that would support Phillips’ theory and Friedman’s theory, respectively?
A. Phillips: 6%; Friedman: 5%
B. Phillips: 7%; Friedman: 6%
C. Phillips: 5%; Friedman: 2%
D. Phillips: 3%; Friedman: 4%
|
Determine the target customer
: Determine the target customer/market(s) to which the product/service in the ad would appeal. You could include information related to age, lifestyle values, attitudes, wants and needs, gender, age, number of kids, education income, stage in the h..
|
|
Write a particular specification for a cut-to-fill earthwork
: Assume that the ground conditions are unknown and could include rock, hard and soft materials. Also assume that the size of the sports field is not known as the Client has not yet decided if he needs a field for soccer, rugby, cricket or hockey, o..
|
|
Normal probability distribution with a standard deviation
: According to media research, the typical American listened to 195 hours of music in the last year. This is down from 290 hours four years earlier.
|
|
Describe the future of organizational behavior
: Using the company selected cvs health, describe the support it provides its employees for continuing education. Describe the future of organizational behavior.
|
|
Inflation and unemployment are correlated
: In 1958, A.W. Phillips stated that inflation and unemployment are correlated. In 1972, Milton Friedman stated that Phillips' relationship was only temporary, and thus only applicable in the short-run. Friedman contended that people will over time ant..
|
|
How does the use and collection of data in healthcare affect
: By now you know how data is used in healthcare. In your opinion, how does the use and collection of data in healthcare affect the quality of patient care?
|
|
Branding of the products
: What are some of advantages associated with branding of the products?
|
|
The management of the shipping company
: The Atlantic Coast Shipping Company has a warehouse terminal in Spartanburg, South Carolina. The capacity of each terminal dock is three trucks. As trucks enter the terminal, the drivers receive numbers;
|
|
Factors contributing to the rising cost of health care
: Identify the factors contributing to the rising cost of health care. When did rising health care costs become an issue? Why are health care costs continuing to rise? What can be done to address this issue?
|