Q5) Graphically illustrate (using the WS and PS relations) and explain the effects of an increase in the markup on the equilibrium real wage, the natural rate of unemployment, the natural level of employment, and the natural level of output.

Q6) Based on your understanding of the aggregate supply and aggregate demand model and the IS-LM model, graphically illustrate and explain what effect a tax increase will have on the economy.In your graphs, clearly illustrate the short-run and medium-run equilibrium.

Q7) Based on your understanding of the Phillips curve, is it possible for the unemployment rate to increase while inflation increases?Explain.