 Unemployment and short-run output are negatively related. See page 228+ Okun’s Law.     Assuming that u-bar is fixed   Showing that unemployment and short-run are negatively related. The higher the short-run deviation of output from its natural rate, the lower the unemployment rate. |
Teaching - Curtis Kephart > Econ 100B Intermediate MacroEconomics (Homework and exam examples) > Econ100b Macroeconomics Mid-Term-2 Review >