Question 13 Use the following information to answer the next two questions. Consider the Phillips curve...
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Question 13 Use the following information to answer the next two questions. Consider the Phillips curve 1-²-(-U) with e=1.5, u*-0.06, and n=0.05. Suppose that u₁-u". Suppose the current goverment pressures the RBA to bring the economy to an inflation rate of 0.03 for the next period. With adaptive expectations, what unemployment rate will result from the policy? (enter "x" without the quotes if there is not an inflation rate that can produce the target unemployment.) Report your answer as a decimal fraction up to two decimal points. Question 14 1 pts Unemployment equal to u Use the information from the previous question. Suppose instead that expectations are rational and that the public anticipates the move by the RBA. What unemployment rate would result? An unemployment rate equal to the target O An unemployment rate below the target O An unemployment rate between the target and u* 0.5 pts Question 13 Use the following information to answer the next two questions. Consider the Phillips curve 1-²-(-U) with e=1.5, u*-0.06, and n=0.05. Suppose that u₁-u". Suppose the current goverment pressures the RBA to bring the economy to an inflation rate of 0.03 for the next period. With adaptive expectations, what unemployment rate will result from the policy? (enter "x" without the quotes if there is not an inflation rate that can produce the target unemployment.) Report your answer as a decimal fraction up to two decimal points. Question 14 1 pts Unemployment equal to u Use the information from the previous question. Suppose instead that expectations are rational and that the public anticipates the move by the RBA. What unemployment rate would result? An unemployment rate equal to the target O An unemployment rate below the target O An unemployment rate between the target and u* 0.5 pts
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Question 13 Given e 15 u 006 2 005 The target inflation rate is 3 003 ... View the full answer
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