All questions involve a "ceteris paribus" scenario.

For questions 1-5 please explain what will happen to the price level and unemployment. Assume that the changes occur in Region 2 of the AS function. Please treat each change separately.

1. An increase in productivity (no increase in nominal wages).

2. A 12 % Increase in wages (no change in productivity).

3. A nation-wide improvement in Technology

4. Depreciation rates are adjusted requiring businesses to fully depreciate assets in a 5-year horizon rather than a 3-year horizon.

5. Export increase < Import increase.