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please correct the statement if it false, or if it is true justify why its true

please correct the statement if it false, or if it is true justify why its true

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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please correct the statement if it false, or if it is true justify why its true. Thank you.....

1. The economy has unemployment below the Natural Rate of Unemployment and NAIRU, but slightly less than full employment when the government sends troops into Syria and approves $50 billion to support the war effort. The effect of this policy is best shown using an AD-AS model. 2. If the economy experiences a modest recession, the DAS and Potential GDP curves shift left and we quickly get a new long run equilibrium with higher prices and lower output. This is an example of an "invisible hand process." Use a DAD-DAS graph 3. If unemployment has risen to 9.4%, the government should use fiscal and monetary policy to stimulate the economy (increasing income and interest rates). This analysis is best shown using an AD-AS model. Use both DAD-DAS and IS-LM graphs IF
Transcribed Image Text:1. The economy has unemployment below the Natural Rate of Unemployment and NAIRU, but slightly less than full employment when the government sends troops into Syria and approves $50 billion to support the war effort. The effect of this policy is best shown using an AD-AS model. 2. If the economy experiences a modest recession, the DAS and Potential GDP curves shift left and we quickly get a new long run equilibrium with higher prices and lower output. This is an example of an "invisible hand process." Use a DAD-DAS graph 3. If unemployment has risen to 9.4%, the government should use fiscal and monetary policy to stimulate the economy (increasing income and interest rates). This analysis is best shown using an AD-AS model. Use both DAD-DAS and IS-LM graphs IF
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