(Last Word) The fallacy of composition states that:
A. because economic systems are composed of so many diverse economic units, economic
laws are necessarily inexact.
B. the anticipation of a particular event can affect the composition of that event when it
occurs.
C. what is true for the individual must necessarily be true for the group.
D. because event A precedes event B, A is necessarily the cause of B.
Answer: A
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The key variable in determining changes in a country's standard of living is the
A. unemployment rate. B. long-run rate of economic growth. C. inflation rate. D. interest rate.
Suppose the natural unemployment rate is 5 percent, the actual unemployment rate is 6 percent, and potential GDP is $5,000 billion. Based on Okun's Law, real GDP is equal to ________ billion
A) $4,000 B) $4,900 C) $5,900 D) $5,000 E) $5,100
If the supply of labor increases while demand for labor is unchanged,
A) the real wage and labor productivity will increase. B) the real wage will decrease and labor productivity will increase. C) the real wage will increase and labor productivity will decrease. D) the real wage and labor productivity will decrease.
The government may not be able to improve the inefficiencies of a monopolistically competitive market
a. True b. False Indicate whether the statement is true or false