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Monetarists argue that in the long run there is no Philip curve trade-off as Long Run AS is inelastic. If there is an increase in aggregate demand, then workers demand higher nominal wages. When they receive higher nominal wages, they work longer hours because they feel real wages have increased. (their price expectations are based on last year). However, this increase in AD causes inflation, and therefore, real wages stay the same. When they realise real wages are the same as last year, they change their price expectations, and no longer supply extra labour and the real output returns to its original level. Therefore, unemployment remains unchanged, but we have a higher inflation rate. Hence in long run, the Philip curve is vertical.
Select the Venn diagram that best illustrates the relationship between the following classes.
Electrical Appliance, Refrigerator, Freezer
...
Select the set in which the numbers are related in the same way as are the numbers of the following sets.
(NOTE : Operations should be performe...
‘Track’ is related to ‘Athlete’ in the same way as ‘Classroom’ is related to ‘______’.
A person starts from point Z and moves 7 km towards the South. He turns right and moves 5 km, turns right, and moves 3 km, then turns right and moves 1 ...
Which of the following numbers will replace the question mark (?) in the given series?
108, 99, 88, ?, 60, 43
Study the given pattern carefully and select the letter from among the given options that can replace the question mark (?)
Who sits at the extreme right end of the row?
Two statements A and B are given. There may be a cause-and effect relationship between the two statements. These two statements may be the effect of the...
Select the option that is related to the third term in the same way as the second term is related to the first term.
Srilanka : Island :: India : ?