Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

why the natural level of production is constant regardless of the natural interest rate changes is really because its the level of production that the

why the natural level of production is constant regardless of the natural interest rate changes is really because its the level of production that the firms uses its resource the most efficiently?I do think price level, nominal rate of interest do not affect the natural level of output, so what factors affect the natural level of output? please illustrate with diagrams if possible, thanks a lot!

image text in transcribed
I-'lg. 4.9 The edict of optimism on the natural rate of Interest f In to 1,, but because of the increase in the interest rate. investment will increase only to I]

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Inflation, Unemployment And Capital Malformations

Authors: Bernard Schmitt, Xavier Bradley, Alvaro Cencini

1st Edition

0429767064, 9780429767067

More Books

Students also viewed these Economics questions

Question

Why are you interested in our program?

Answered: 1 week ago

Question

6. How can hidden knowledge guide our actions?

Answered: 1 week ago

Question

7. How can the models we use have a detrimental effect on others?

Answered: 1 week ago