12.2 Materials
READ
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- Chapter 12.2
- (Optional) Read Chapter 12.3. While this section is not required, it will be useful for you to read it. It will help you understand how to use the model to understand real life situations.
WATCH
The next video explains the transition from the short run to the long run. Note that they use an increasing SRAS instead of a flat AS as in Mankiw. In the book Mankiw considers a simpler version in which in the very short run AS is completely horizontal because prices and wages are very sticky. If prices and wages are a little less sticky, SRAS is increasing. This is the case that the video considers.
PRACTICE
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- Look at Problem 9 in the In-Class problem list Download In-Class problem list. Try to do it without looking at the answer key. You can check your answers against an answer key Download answer key afterwards.
- Next, try Problem 10 in the In-Class problem list Download In-Class problem list without looking at the answer key. You can check your answers against an answer key Download answer key afterwards.
- Now try Problem 11 in the In-Class problem list Download In-Class problem list, again without looking at the answer key. Check your answers against an answer key Download answer key afterwards.
DEBATE
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- Participate in the group activity.
DO
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- You should be ready now to do problems 1 and 2 in Problem Set 2 Download Problem Set 2.