How can a country experience economic growth and stable prices?
111) Derive the SRAS and explain fully. Once done, discuss the short-run and long-run equilibrium positions along with the difference between Aggregate Supply and Individual Supply.
112) List the changes that cause an increase (decrease) in Aggregate Supply. Once completed, explain each in relation to their effect on the factors of production and the endowment.
113) Explain with the aid of diagrams the effect of a policy or action that would result in an inflationary and recessionary gap. Show the result graphically and explain the short-run and long-run adjustments that will take place in each case.
114) Explain the problem of "sticky wages" and the implications for the long-run equilibrium. Can something be done to eliminate this problem?
115) Explain in detail, with the aid of diagrams the two types of inflation tat exist in the short-run.
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