Explain how the short-run Phillips curve, the long-run Phillips curve, the short-run aggregate supply curve, the long-run aggregate supply curve, and the natural rate hypothesis are all related. How do active and passive views of these concepts differ?

George has been selling 5,000T-shirts per month for $8.50. When he increased the price to $9.50 he sold only 4,000T-shirts. What is the demand elasticity? If his marginal cost is $4 per shirt, what is his desired markup and what is his initial actual markup? Was raising the price profitable?

Just prior to the year 2000, the Fed was concerned that people would make larger than normal bank withdrawals out of fear of the Y2K computer bug. The Fed feared that this might disrupt the banking system. The Fed wanted to use a defensive action to prevent any such disruption. This would take the form of open market bond.