Explain the effects of ae / a on the unemployment rate

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Suppose an economy is characterized by the following equations:Price setting: P = (1+ m)(W / A). Wage setting: W = AePe (1- u)(a.) Solve for the unemployment rate if Pe = P but Ae does not necessarily equal A . Explainthe effects of Ae / A on the unemployment rate

Reference no: EM131056278

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Explain the effects of ae / a on the unemployment rate : Explainthe effects of Ae / A on the unemployment rate

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