Gm announced that it will close its oshawa truck plant

Reference no: EM13377713

GM announced that it will close its Oshawa truck plant in 2009 and a Windsor transmission plant in 2010. Ford also plans a 10 percent cut in white-collar, salaried positions. In total, over 4000 direct jobs will be lost. This is chilling news for Ontario because for every job in an assembly plant, there are 7.5 jobs with auto-parts suppliers and other companies. Using appropriate diagrams, answer the following questions.

a. Is there a trade-off between the unemployment rate and the inflation rate in the short run? How can the Phillips curve be used to answer this question?

b. What is the relationship between the Phillips curve, aggregate demand, and aggregate supply?

c. If the unemployment rate and inflation are both rising, can this be explained by a movement along a given Phillips curve? What must be happening to aggregate demand and aggregate supply? What must be happening to the Phillips curve?

d. If the Bank of Canada continues to take expansionary monetary policy, how are the unemployment rate and inflation affected? (Use both Phillips curve and AS-AD graphs in your explanation.)

e. Is there a trade-off between the unemployment rate and inflation in the long run? How is the long-run aggregate supply curve related to the long run Phillips curve?

Reference no: EM13377713

Questions Cloud

Recent increases in rents have caused the citizens of : recent increases in rents have caused the citizens of elmville to vote for a rent ceiling of 1200. assuming all rental

Cinema theater has estimated the following demand functions : cinema theater has estimated the following demand functions for its moviesdaytime demand qd 400 - 50 pd nighttime

Given the current economic situation determione the steps : given the current economic situation determione the steps the federal reserve should take to help stabilize our

Your niece just started her college career with a major in : your niece just started her college career with a major in economics. she is curious as to the interrelationship

Gm announced that it will close its oshawa truck plant : gm announced that it will close its oshawa truck plant in 2009 and a windsor transmission plant in 2010. ford

Suppose that kiribati can produce 1000 tons of : suppose that kiribati can produce 1000 tons of breadfruit or 500 tons of fish and that tuvalu can produce 750

Consider republic of netflexs balance of payments in : consider republic of netflexs balance of payments in 2009foreign investment into netflex nbsp nbsp nbsp nbsp nbsp

In 2003 to 2004 the canadian dollar appreciated : in 2003 to 2004 the canadian dollar appreciated against the us dollar. explain the effects of this

In 2008 the debt of canadian households rose much : in 2008 the debt of canadian households rose much faster than their wealth as stock markets corrected and the

User Account

All Pages