that the economy is currently in short run equilibrium but experiencing a recessionary gap. Graphically illustrate the problems, identify the combination of monetary policies that the Federal Reserve would pursue to correct problem, and then graphically illustrate and explain how these monetary policies affect (1) the Market for Reserves, (2) the Market for M1, and (3) the Market for Real Goods and Services

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Unemployment and Cost of Unemployment

Unemployment is the state of being unemployed, even when an individual is actively seeking work opportunities. The unemployment rate refers to the percentage of the workforce that is currently unemployed.