a. The economy is stable with unemployment at 6% and inflation at 2%. (For the following scenarios, assume the economy starts at this
b. A decrease in interests rats causes investment to increase. Explain:
c. An appreciation of the nation's currency leads foreigners to demand less of the country's exports. Explain:
d. The discovery of large reserves of natural gas causes energy prices to decline. Explain:
e. An earthquake strikes, destroying much of the nation's transportation infrastructure. Explain:
f. Home prices decline, harming consumer and investor confidence. Explain:
g. The government reduces payroll taxes by 2% for all households. Explain:
h. Fear over the national debt forces government to reduce its budget deficit. Explain:
i. The EPA requires all the nation's producers to adhere to strict new greenhouse gas emissions standards. Explain:
j. Looser immigration laws increase the available supply of labor in the country. Explain:
k. Rapid economic growth abroad boosts demand for the nation's output. Explain:
l. Create your own scenario: