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Unformatted text preview: Now make comparisons for the relations for the following variables: a. Y (gdp) b. N ( employment) c. K U (Capacity Utilization of Capital) d. U ( Unemployment) e. π (Inflation) 3. Discuss how the economy will adjust in the long run if no policy is chosen to counter the effects of the demand side shock. π 4. Choose a policy to implement as a ‘corrective’ to the above shock and show the effects of this policy in the short run and in the long run. π...
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- Winter '10
- Economics, demand side shock, c. KU