Unformatted text preview: either P , M or both P and M could rise. It is possible that P could remain constant (or even go down) if Y rises, which means that the given statement is false. A3 : False If new entrants are employed: ¯ u = s n + s + f and an increase in n leads to a decline in ¯ u If new entrants are unemployed : ¯ u = n + s n + s + f and ∂ ¯ u n = f ( n + s + f ) 2 > 0, so as n rises, ¯ u will rise as well. 1...
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- Winter '08
- Macroeconomics, Zagreb, 102 Second, Andrew L. Zaeske