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Suppose the economy has a natural rate of unemployment of 5%. a) Suppose short run output over the next year is -2%. According to Okun's
Suppose the economy has a natural rate of unemployment of 5%.
a) Suppose short run output over the next year is -2%. According to Okun's law, what unemployment rate we would expect to see in this economy?
b) Consider another economy in which the unemployment rate next year is 7.5%. According to Okun's law, what is the level of short-run output in this economy?
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