Assume weak growth in aggregate demand keeps the economy below potential GDP, so unemployment rises but inflation falls. This explains the ________ slope of the short-run Phillips curve
A) infinite B) positive C) negative D) zero
C
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During periods of inflation, all prices increase
a. True b. False Indicate whether the statement is true or false
Economists generally recognize that rent controls cause shortages in housing, yet rent controls tend to persist. Why does this occur?
a. Many people do not understand the effects that controls cause. b. Property owners are politically unpopular. c. Many persons tend to benefit from rent controls. d. All of the above are correct.
Which of the following events will cause the unemployment rate to increase?
A. an increase in population, with no change in the size of the labor force B. a proportionally equal increase in the labor force and the number of unemployed workers C. an increase in the labor force with no change in the number of employed workers D. an increase in the number of employed workers with no change in the number of unemployed workers
Suppose prices for new homes have risen, yet sales of new homes have also risen. We can conclude that:
A. the demand for new homes has risen. B. the law of demand has been violated. C. new firms have entered the construction industry. D. construction firms must be facing higher costs.