Question: Consider the statement: While the central bank can stabilise the economy s rate of unemployment at its structural level, it is quite probable that output
Consider the statement: While the central bank can stabilise the economys rate of unemployment at its structural level, it is quite probable that output will not be staying at its potential level, because the actual level of output is affected by various demandside shocks, which have no impact on the labour market Using the ISLMPC model and the concept of the Phillips curve, explain the intuition behind the concepts: structural unemployment and potential output Do you agree with the statement? Why or why not? Use relevant diagrams to illustrate your argument.
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