The Natural Rate of Unemployment Research Proposal

The Natural Rate of Unemployment - Research Proposal Example According to the model, the workers and the firms undertake negotiation in order to decide on the nominal this. This negotiation is done irrespective of the expected price level of the economy. The nominal wage is determined as the product of the target real wage rate and the expected level of price in the economy. Most of the economists are of the opinion that the nominal wage in the economy is sticky in the short run. With a sticky nominal wage in the economy, the prices would increase from P to P0. This would reduce the real wage rate in the economy. Since the wages are the prices for labor the demand curve for labor would be a downward sloping curve and the supply curve would be an upward rising one. The now the labor market would comprise of the employed and the unemployed labor force. Thus the total labor in the economy would be Therefore the level of unemployed in the economy would be LN, where L is the total labor force, N is the employed and U is unemployed. Therefore the natural rate of unemployment in the economy would be U* / L. Now the wage setting relation establishes a negative relationship between the real wage that exists in the economy and the rate of unemployment existing in the economy. This relation can be represented by the downward sloping curve that is shown in the diagram below. As the rate of unemployment in the economy would increase the wages that the laborers would demand would be less (Broughton, 2009. pp. 3-5).

GASB and FASB Accounting Essay Example | Topics and Well Written Essays - 750 words

GASB and FASB Accounting - Essay Example Whereas FASB has the objective to establish and improve standards for financial accounting and reporting that will help in guiding and educating public including auditors and other users of financial statements.   GASB was constituted in 1984 to succeed National Council on Government Accounting as a standard-setting body for state and local governmental bodies, whereas FASB issues standards and other pronouncements for entities other than governmental bodies. However, when there are no pronouncements on certain issues from GASB, the pronouncements issued by the FASB shall become applicable to governmental bodies as well. So far as business organizations are concerned, they have to abide by the standards issued by FASB. Non- business organizations, non- government organizations follow FASB and the government organizations come under the domain of GASB.   GASB is very specific to state legislature while issuing pronouncements. FASB, on the other hand, issues pronouncements that are universal and cater the business on a federal basis. In fact â€Å"FASB receives many requests for action on various financial accounting and reporting topics from all segments of its diverse constituency, including investors and the SEC. The auditing profession is sensitive to emerging trends in practice, and consequently, it is a frequent source of requests. Requests for actions include both new topics and suggested review or reconsideration of existing pronouncement.†(Facts about FASB, page 1)   It is believed that governments need not show profits like other financial entities.