How fast will potential output have to grow each year

Reference no: EM13182164

The Ben Bernanke has said that the Federal Reserve is going to continue its latest round of Quantitative Easing until unemployment falls to 6.5%. How fast will the economy have to grow to bring unemployment down to 6.5% by this time next year? Assume that potential output grows at 3.5% a year. How fast will it have to grow each year to reach 6.5% unemployment in 3 years (this time 2016)?

Reference no: EM13182164

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