Q3 - Modules L7. Inflation and the Phillips Curve[Suggested word count for Q3: 400 to 500 words]In 2021, (almost after the COVID-19 related lockdowns were relaxed in Australia) Australianconstruction industry was facing high demand resulting into a boom in the construction ofnew housing. This can partly be attributed to the generous economic stimulus packagesgiven by the government (for instance, see the articles below).●Australia launches $470 million stimulus package for construction sectorhttps://www.reuters.com/article/us-health-coronavirus-australia-idUSKBN23B02XPost Pandemic Construction Boomhttps://slattery.com.au/wp-content/uploads/2021/12/Slattery-National-Market-Update-December-2021.pdfUsing the AD and Phillips curve model, show the state of the Australian economy assuminghaving a stable target inflation of 2% prior to COVID-19. Now, in the same model, show andexplain the impact of the above-mentioned construction boom on employment andinflation levels in Australia resulting in the current state of the economy (2022- 2023).

The Phillips curve is an economic concept that proposes a negative correlation between the…

Using the AD and Phillips curve model, show the state of the Australian economy assuming having a stable target inflation of 2% prior to COVID-19. Now, in the same model, show and explain the impact of the above-mentioned construction boom on employment and inflation levels in Australia resulting in the current state of the economy (2022- 2023).

Using the AD and Phillips curve model, show the state of the Australian economy assuming having a stable target inflation of 2% prior to COVID-19. Now, in the same model, show and explain the impact of the above-mentioned construction boom on employment and inflation levels in Australia resulting in the current state of the economy (2022- 2023).

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Q7 Answer part a only
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Homework: Chapter 27 1. Aggregate demand, aggregate supply, and the Phillips curve In the year 2020, aggregate demand and aggregate supply in the fictional country of Bartak are represented by the curves AD20 and AS on the following graph. The price level is 102. The graph also shows two possible outcomes for 2021. The first potential aggregate demand curve is given by the ADA curve, resulting in the outcome illustrated by point A. The second potential aggregate demand curve is given by the ADB curve, resulting in the outcome illustrated by point B. PRICE LEVEL 106 AS 107 106 B 105 104 AD 2020 103 102 101 19V 100 D 10 AD OUTPUT (Trillions of dollars) ADB 12 14 (?) Suppose the unemployment rate is 6% under one of these two outcomes and 3% under the other. Based on the previous graph, you would expect to be associated with the lower unemployment rate (3%). outcome B outcome A emand is high in 2021, and the economy is at outcome B, the inflation rate between 2020 and 2021 is Based on your…