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q2 Question 8 In the flexible price DSGE model, an increase in total factor productivity today will: (a) (b) (C) (d) (6) shift the labour

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Question 8 In the flexible price DSGE model, an increase in total factor productivity today will: (a) (b) (C) (d) (6) shift the labour demand curve up and to the right causing the real wage and employment to rise shift the labour demand curve down and to the left causing the real wage and employment to fall shift the labour supply curve up and to the left causing the real wage to rise and employment to fall shift the labour supply curve down and to the right causing the real wage to fall and employment to rise shift neither the labour demand nor labour supply curves leaving the real wage and employment unchanged Question 9 Suppose the tax firms must pay on each dollar of revenue they receive from selling their output increases from, say, 30 to 40 cents in the dollar. In the flexible price DSGE model, this will: (a) (b) (C) (d) (6') shift the labour demand curve up and to the right causing the real wage and employment to rise shift the labour demand curve down and to the left causing the real wage and employment to fall shift the labour supply curve up and to the left causing the real wage to rise and employment to fall shift the labour supply curve down and to the right causing the real wage to fall and employment to rise shift neither the labour demand nor labour supply curves leaving the real wage and employment unchanged

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