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Elements found in New Keynesian
New Keynesianism is a combination of elements of tradition Keynesianism and the classical theory. There are different elements of New Keynesianism which you would learn from our experts. We are ready to guide you and deliver knowledge that can be helpful in your future development.
The elements are:
- There are many markets that are competitive and have a monopoly power. Therefore, firms are eligible for setting up the price and can also cut prices which leads to price rigidity.
- New Keynesian Economics homework help will speak about the labor markets which are imperfect as well. Wages are low which is termed as ‘sticky downwards’ and unions and firms can resist nominal wage cuts.
- In case of shock to economy there would a fall in demand and due to downpour of economy the market would experience real wage unemployment.
- Real interest rates may be different from that of ‘natural interest rate’. In order to avoid macro-economic instability, the monetary authorities need to restore the accurate interest rate.
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