In the Dynamic Model, the Supply Shock Variable, υ

question 13

Multiple Choice

In the dynamic model, the supply shock variable, υ , is a variable appearing in which of the following equations of the
T
Model?

• A)Fisher equation
• B)Phillips curve
• C)monetary-policy rule
• D)adaptive expectations

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Definitions:

Supply Analysis

The examination and evaluation of the supply side of the market, focusing on factors such as production capacity, supplier behavior, and costs.

Primary Industry

The sector of the economy that extracts and harvests natural resources directly from the Earth, such as agriculture, mining, and forestry.

Normal Goods

Goods for which demand increases as the income of the buyer increases, and vice versa.

Income Increase

A rise in the amount of money received, especially on a regular basis, through work or investments.