Imagine a new technology emerged, allowing for increased productivity and drivin

Question

Imagine a new technology emerged, allowing for increased productivity and driving U.S. real GDP growth from 2.5 percent one year to 3 percent in the next year. Given this information, the change in the unemployment rate when the growth rate is 2.5 percent will be to nearest two decimals,) The change in the unemployment rate when the growth rate increases is 3 percent will be to decimals) l -by?percent. (Round yo V by percent. (Round your response to the Vby percent. (Round your response to the nearest two

Explanation / Answer

A.Change in U=-.4(Gyt-3%)

3% is growth rate required to increase GDP by 1 percentage point.

When Gyt=2.5%

Change in U=-.4(2.5-3)%

Change in U=.2%

B.When Gyt=3%

Change in unemployment rate will be 0

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