Use the Information Below to Explain Adjustments That Move the Economy

question 38

Essay

Use the information below to explain adjustments that move the economy to a long-run equilibrium.Assume that firms and workers have adaptive expectations.
The current unemployment rate = 7%.
The natural rate of unemployment = 5.5%.
Last year's inflation rate = 5%.
This year's inflation rate = 4%.

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Definitions:

Issues Management

The proactive process of identifying, evaluating, and responding to issues and trends that could affect an organization’s relationships with its stakeholders and its reputation.

Crisis Communication

A specialized area of public relations designed to protect and defend an individual, company, or organization facing a public challenge to its reputation.

Crisis Communication

The effort by a business or organization to communicate effectively during unexpected events that threaten to harm its reputation or stakeholders.

Issues Management

The systematic identification, evaluation, and handling of any issue that could impact an organization’s ability to achieve its objectives, often involving preventive public relations strategies.