60 423
Assignments Done
98,2%
Successfully Done
In April 2018

Answer to Question #72009 in Macroeconomics for Sarah

Question #72009
''What is meant by the “natural rate of unemployment”? Using diagrams show what happens to the natural rate of unemployment if there is an increase in firms’ price mark up. What is the effect on the supply function?''
in the question above I'm confused about what is meant by ''What is the effect on the supply function'' i tried to solve it assuming that supply function is the aggregate supply. Markup increases then wage decrease so AS shifts right because workers are willing to accept any salary. Is my answer right?
Expert's answer
Correct.
As wage decreases, markup grows. Therefore, AS shifts right because workers are willing to accept any salary.

Need a fast expert's response?

Submit order

and get a quick answer at the best price

for any assignment or question with DETAILED EXPLANATIONS!

Comments

No comments. Be first!

Leave a comment

Ask Your question

Submit
Privacy policy Terms and Conditions