Refer to Exhibit 6-2. The unemployment rate in year 1 is
a. 12 1/2 percent.
b. 70 percent.
c. 87 1/2 percent.
d. 30 percent.
e. 10 percent.
Answer: a. 12 1/2 percent.
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Refer to Table 26-3. Consider the hypothetical information in the table above for potential real GDP, real GDP, and the price level in 2016 and in 2017 if the Federal Reserve does not use monetary policy
If the Fed uses monetary policy successfully to keep real GDP at its potential level in 2017, which of the following will be lower than if the Fed had taken no action? A) real GDP and the inflation rate B) real GDP and potential GDP C) potential GDP and the inflation rate D) real GDP and the unemployment rate
Investment banks do NOT engage in which of the following?
A) proprietary trading B) securitization C) lending to households D) underwriting
When there are no vacancies, how many people serve on the Board of Governors of the Federal Reserve system?
A. 11 B. 12 C. 7 D. 5
Ford Motor Company started producing the Model A at plants scattered around the United States
A) to save on transport costs. B) because diseconomies of scale at its initial River Rouge plant resulted in high production costs. C) to locate its production centers closer to its customers. D) because it was not able to attract skilled workers in Michigan (where its first plant was located).