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1) Use the AS/AD model for describing different
unemployment—inflation scenarios. Which kinds of inflation do
you show, thereby? Based on these scenarios, what can you say
about situations in which we can observe a Phillips curve in an
economy? (2.5) 2) Explain how different approaches to
government deficits can stabilize or destabilize economies. (2.5)

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  • 1. 1) Use the AS/AD model for describing different unemployment—inflation scenarios. Which kinds of inflation do you show, thereby? Based on these scenarios, what can you say about situations in which we can observe a Phillips curve in an economy? (2.5) 2) Explain how different approaches to government deficits can stabilize or destabilize economies. (2.5)