Q4. a) With respect to the Business Cycle, what is the definition of: leading indicator,coincident indicator, and lagging indicator? Provide 2 examples of each leading, coincident and lagging indicator. b) Define the three ranges of the aggregate supply curve in the AD/AS framework. c) Describe the types of unemployment classification. d) Define what is 'automatic stabiliser' in fiscal policy, and provide 2 examples.

Q4. a) With respect to the Business Cycle, what is the definition of: leading indicator,coincident indicator, and lagging indicator? Provide 2 examples of each leading, coincident and lagging indicator. b) Define the three ranges of the aggregate supply curve in the AD/AS framework. c) Describe the types of unemployment classification. d) Define what is 'automatic stabiliser' in fiscal policy, and provide 2 examples.

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter10: Aggregate Demand And Supply

Section10.A: The Self Correcting Aggregate Demand And Supply Model

Problem 10SQ

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With respect to the business cycle, what is the definition of: leading indicator, coincident indicator, and lagging indicator? Provide 2 examples of each leading, coincident and lagging indicator Define then three ranges of the aggregate supply curve in the AD/AS framework. Describe the types of unemployment classification. Define what is ‘automatic stabiliser’ in fiscal policy, and provide 2 examples.
a) What is 'Business Cycle'? b) What is the defination of: leading indicator, coincident indicator, and lagging indicator? Provide 2 examples of each leading, coincident and lagging indicator c) Define the three ranges of the aggregate supply curve in the AD/AS framework
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Figure 1: Hayek’s (Classical) AD-AS Model 1.1. Hayek says that markets will heal themselves and that government should not intervene. How does the AD-AS model reflect Hayek’s idea that governments cannot increase real GDP beyond the level that the free market economy is able to produce? 1.2. Do you believe that the Hayek’s classical AD-AS model explain the factors that cause changes (shifts) in AS realistically? Why or why not? Figure 2: Keynes’s AD-AS Model 2.1. In Figure 2 above, what are the factors that may cause the aggregate demand to shift from AD to AD1? What is the difference between demand pull inflation, cost push inflation and recession? 2.2. In macroeconomics, the immediate short run is known as a length of time when both input prices and output prices are fixed. In the short-run, input prices are fixed but output prices are variable. In the long run, input prices and output prices can vary. Describe the AS curve in the Immediate Short run. Describe the AS curve…