Question 15 · Introducció a la Macroeconomia UPF 2019
Tema: Mercat de treball i atur · Del examen Final Exam - March 2019 (2019)
Enunciado
Question 15 (0.25 points). Tariffs in WS-PS framework
Assume the labor market is represented by wage-setting (WS) and price-setting (PS) relations. Suppose an escalated trade conflict leads to higher tariffs on imports into the United States, thereby shielding domestic firms from competition and enabling them to apply higher price markups. In the medium run, this tariff increase will cause:

Solución
Según los criterios oficiales de corrección
In the medium run, this tariff increase will cause:
Solución: c. Lower real wages and a higher natural rate of unemployment.
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