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T3-Q3
May 12, 2016 21:03:30 GMT
Post by guest on May 12, 2016 21:03:30 GMT
Hi Oliver,
I noticed that the answer for Tutorial 3 Question 3 (unanticipated part) is different from the answer provided by Paul Egan's revision tutorial. There is no shift of AS curve in Paul Egan's answer for unanticipated part. So which one is right? Thank you |
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T3-Q3
May 12, 2016 22:17:15 GMT
Post by Oliver on May 12, 2016 22:17:15 GMT
Hi,
I have not looked at Paul's solutions. Which one do you think is right? If you think mine is wrong, please explain why and I --- as always --- will carefully think about it. If you think Paul is wrong, please discuss this with Paul.
Best
Oliver
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T3-Q3
May 13, 2016 8:58:24 GMT
Post by Oliver on May 13, 2016 8:58:24 GMT
Hi,
I've just had an opportunity to get onto MMS and have a look. Both solutions are right, mine simply goes one step further.
What happens immediately the shock hits?:
Unanticipated shock: AD curve shifts
Anticipated shock: AD and AS curve both shift
This is where Paul's answer stopped.
What happens later (included in my answers only)?:
Unanticapted shock: Now, AS curve has to shift
Anticipated shock: Nothing else needs to happen (the AS adjustment had already occurred).
Best
Oliver
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