1. For a long run closed economy, a plaguecauses a sharp decrease in the labor force.What happens to Y, W/P, R/P, r, C, I, P, e?Explain with carefully labeled figures.2. What happens if an investment tax creditexpires?3. What happens if there is a sudden burst inthe economy's productivity?4. What differentiates the short runmacroeconomic model from the one in thevery long run.

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1. For a long run closed economy, a plague causes a sharp decrease in the labor force. What happens to Y, W/P, R/P, r, C, I, P, e?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter19: The Macroeconomic Perspective

Section: Chapter Questions

Problem 4SCQ: Without looking at Table 19.7, return to Figure 19.10. If we define a recession as a significant...

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