According to the short-run Phillips curve, if unemployment is 2.4% and inflation is 3.7%, a decrease in the inflation rate might result in which of the following?
A) an increase in the unemployment rate to 3.4%
B) a decrease in the unemployment rate to 3.0%
C) a decrease in the demand for labor in the economy
D) Both A and C are correct answers.
D
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Excess reserves are
A) desired reserves minus actual reserves. B) required reserves minus actual reserves. C) liquidity funds minus actual reserves. D) actual reserves minus desired reserves.
Refer to Figure 2-9. What is the opportunity cost of producing 1 popsicle in Iceland?
A) 1 1/2 snow cones B) 3/4 of a snow cone C) 2/3 of a snow cone D) 270 snow cones
Investment will decrease if business taxes ____, real interest rates ____, or if business confidence ____
a. increase, increase, increases b. decrease, decrease, decreases c. increase, increase, decreases d. decrease, decrease, increases
It is spring, and several graduates of State U are seeking employment. State U graduates have evenly distributed GPAs, from 2.0 to 4.0, with an average GPA of 3.0. The largest employer in town, Acme Dynamite, is interviewing candidates, hoping to hire a few hard workers. While Acme does not require students to submit a transcript with their applications, the hiring officer believes that high GPAs signal a willingness to work hard. Suppose that all State U students have the same academic ability when they enter college and do not learn anything in college that will be useful to them while working at Acme. Students differ only in their willingness to work hard and study for their classes. In this case:
A. Acme will not care about a student's GPAs because all students enter college with the same academic ability. B. Acme will not care about a student's GPAs because the students at State U don't learn anything useful in their classes. C. Acme will use a student's GPA as a signal of the student's willingness to work hard. D. there is no benefit to studying hard in college.