1 normally we think of the factors that cause the ad curve, Ask an Expert

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1. Normally we think of the factors that cause the AD curve to shift as different from the factors that cause the LRAS curve to shift. Is this still true in the case of hysteresis? Briefly explain.

2. In a speech in September 2010, Narayana Kocherlakota, president of the Federal Reserve Bank of Minneapolis noted: The job openings rate has risen by about 20 percent between July 2009 and June 2010. Under this scenario, we would expect unemployment to fall because people find it easier to get jobs. However, the unemployment rate actually went up slightly over this period. The job openings rate is defined as the number of job openings-that is, unfilled jobs that are available-divided by the sum of job openings and employment. If the job openings rate was increasing between July 2009 and June 2010, why didn't the unemployment rate fall?

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