30.1 Explain why wages might change…
What is the role of an output gap, expectations?
Why do prices change?
What is the role of an output gap, expectations, and supply shocks?
When would you expect to see constant inflation?
30.2 Shocks and responses…
Explain how a one-time shock might cause a single jump in price levels
Explain how a one-time shock that receives Monetary validation might cause sustained inflation and acceleration of inflation.
30.3 Reducing Inflation
What are the three steps outlined by Ragan to reduce inflation?
What are the costs to reducing inflation?
Chapter 31
31.1 In Canada…
How has unemployment and employment changed in Canada?
What are the costs associated with high unemployment?
31.2 Fluctuations
Several theories discuss market-clearing; how does this idea work?
How do non-market-clearing theories work?
31.3 NAIRU
What are the components of NAIRU?
31.4 How might a government reduce unemployment (NAIRU)?
Chapter 32 (only section 32.3)
32. 3 “Crowding Out”
How does Crowding out occur?
What conditions are necessary for the theory of “Crowding Out” to operate?
What actions might mitigate the effects of crowding out?
