INFLATION AND UNEMPLOYMENT PART THREE INFLATION AND UNEMPLOYMENT

Aggregate Demand, Aggregate Supply, and the Self-Correcting Economy Chapter 7 Aggregate Demand, Aggregate Supply, and the Self-Correcting Economy

Figure 7-1 Effect on Real Income of Different Values of the Price Level Copyright © 2003 by Pearson Education, Inc.

Figure 7-2 The Effect on the AD Curve of a Doubling of the Nominal Money Supply Copyright © 2003 by Pearson Education, Inc.

Figure 7-3 The Effect on the AD Curve of a Decline in Planned Autonomous Spending Copyright © 2003 by Pearson Education, Inc.

Figure 7-4 Effect of a Rightward Shift in the AD Curve with Three Alternative Short-Run Aggregate Supply Curves Copyright © 2003 by Pearson Education, Inc.

Figure 7-5 The Labor Demand Curve, the Production Function, and the Short-Run Aggregate Supply Curve Copyright © 2003 by Pearson Education, Inc.

Figure 7-6 The Short-Run Aggregate Supply Curve for Two Different Values of the Wage Rate, W0 and W1

Figure 7-7 Determination of the Equilibrium Real Wage Rate

Figure 7-8 Effects on the Price Level and Real Income of an Increase in Planned Autonomous Spending from AD0 to AD1 Copyright © 2003 by Pearson Education, Inc.

Figure 7-9 Effect of a Decline in Planned Spending When the Price Level Is Perfectly Flexible

Figure 7-10 The Lack of Effect of a Drop in the Price Level When There Is a Failure of Self-Correction Copyright © 2003 by Pearson Education, Inc.

International Perspective Deflation Deepens Japan’s Dilemma Source: OECD Economic Outlook, December 2001.

Figure 7-11 Effect of a Decline in Planned Spending When the Nominal Rate Is Fixed at W0 Copyright © 2003 by Pearson Education, Inc.

Figure 7-12 The Price Level (P) and the Ratio of Actual to Natural Real GDP (Y/YN) During the Great Depression, 1929–41 Copyright © 2003 by Pearson Education, Inc.