Suppose an Economy Experiences an Increase in Productivity

question 37

Essay

Suppose an economy experiences an increase in productivity.Explain both the short-run and medium-run effects of this increase in productivity on output,employment,and the unemployment rate.

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Definitions:

Collateral

Assets pledged by a borrower to secure a loan or credit, which can be seized by the lender if the borrower fails to repay the loan.

Inadequate

Lacking the quality or quantity required; insufficient for a purpose.