The natural rate of unemployment is the rate that prevails when structural, frictional, and seasonal unemployment are all equal to zero, and the only source of unemployment is cyclical unemployment
Indicate whether the statement is true or false
false
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What is the equation of exchange? Suppose that real GDP and velocity are constant. In this case, what effect will an increase in the quantity of money have?
What will be an ideal response?
Suppose MPL = 0.5 ? (q/L) and MPK = 0.5 ? (q/K). In the long run, the firm will hire equal amounts of capital and labor
A) all of the time. B) only when w = r. C) only when w = 0.5 ? r. D) at no point in time.
Which of the following would not be considered an automatic stabilizer?
A. Defense spending B. Unemployment compensation C. Income tax D. Welfare payments
Consider a small open economy in equilibrium with a current account deficit. (a)Draw a diagram showing this situation.(b)What happens to national saving, investment, and the current account balance in equilibrium if government expenditures rise temporarily? Show this result in your diagram.
What will be an ideal response?