Can you answer questions 1-5 and take a picture of your response please. Thank you!

The abbreviations for question 3 are W is nominal wage and P is price level.

pring 2021(3) (1) - Word O Search Mailings Review View Help 1. (8 points) Briefly define the following variables (in a sentence or two each): Y, r, P, and it 2. (4 points) What determines how fast real GDP grows in the very long run (Solow model)? How are the variables determining that growth rate defined? 3. (2 points) What are the units of W/P? In other words, we typically measure a person's height in inches, so what units are used for W/P)? Explain. 4. (2 points) Why do economists look at real GDP rather than nominal GDP when trying to determine whether the output of goods and services is increasing or decreasing? 5. (4 points) What's the advantage of looking the rate of change of a variable year-over-year rather than at an annualized rate? Next, what's the advantage of looking at an annualized rate rather than a year- over-year rate? These two charts may help you. FRED-Bewert FRED- how SA Show SUS 6. (10 points) Assume that when output is below its natural rate of output, the SRAS curve is elastic (relatively flat) but that when output is above its natural rate of output, the SRAS curve is inelastic (relatively steep). a. First, draw the AD-SRAS model as described and note where EP=P. b. Now consider what happens if the Fed increases the money supply when output is far below its natural rate of output. What can you predict about the relative effects of this monetary stimulus on P and Y? c. Draw your figure again and now consider what happens if the Fed increases the money supply when output is far above its natural rate of output. What can you predict about the relative effects of this monetary stimulus on P and Y? pring 2021(3) (1) - Word O Search Mailings Review View Help 1. (8 points) Briefly define the following variables (in a sentence or two each): Y, r, P, and it 2. (4 points) What determines how fast real GDP grows in the very long run (Solow model)? How are the variables determining that growth rate defined? 3. (2 points) What are the units of W/P? In other words, we typically measure a person's height in inches, so what units are used for W/P)? Explain. 4. (2 points) Why do economists look at real GDP rather than nominal GDP when trying to determine whether the output of goods and services is increasing or decreasing? 5. (4 points) What's the advantage of looking the rate of change of a variable year-over-year rather than at an annualized rate? Next, what's the advantage of looking at an annualized rate rather than a year- over-year rate? These two charts may help you. FRED-Bewert FRED- how SA Show SUS 6. (10 points) Assume that when output is below its natural rate of output, the SRAS curve is elastic (relatively flat) but that when output is above its natural rate of output, the SRAS curve is inelastic (relatively steep). a. First, draw the AD-SRAS model as described and note where EP=P. b. Now consider what happens if the Fed increases the money supply when output is far below its natural rate of output. What can you predict about the relative effects of this monetary stimulus on P and Y? c. Draw your figure again and now consider what happens if the Fed increases the money supply when output is far above its natural rate of output. What can you predict about the relative effects of this monetary stimulus on P and Y