Question: Please explain carefully including all necessary steps. b. Using the sacrifice ratio and Okun's law, calculate the impact on GDP and unemployment if the central

Please explain carefully including all necessary steps.

b. Using the sacrifice ratio and Okun's law, calculate the impact on GDP and unemployment if the central bank intends to cut inflation from 15% to 7%. [8 marks] C. In the economy, the parameter 'a", which measures how much the firm's desired price responds to the level of aggregate output, is 0.35. The natural rate of output is 2,200, the actual price level is 74 and the expected price level is 44. If 40% of the firms in the economy adopt sticky prices, then calculate the actual level of output. Students should refer to the sticky price model. [6 marks]

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