The existence of discouraged workers will lead to an official unemployment rate that is:
A. overstated.
B. understated.
C. either overstated or understated.
D. unbiased.
Answer: B
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Asymmetric information means
A) some market participants have more information than others. B) some news are more important than others. C) some market participants interpret news differently. D) the impact of news on economic outcomes depends on the context.
There is general agreement among economists that a proposed fiscal policy should be evaluated for its:
A. potential positive and negative effects on long-run productivity growth. B. contribution to the purpose of "fine-tuning" the economy. C. contribution to the growth of exports and imports in the economy. D. potential positive and negative effects on short-run business indebtedness.
If you decide to go to a movie on a Friday night rather than write a letter to your grandmother, you
A) are willing to deprive your grandmother of a letter simply in order to enjoy a movie. B) place more value on the movie than on your grandmother. C) would rather have fun than fulfill your responsibilities to your relatives. D) none of the above.
Plants, trees, and soils naturally emit carbon dioxide (CO2 ) that enters the atmosphere
To form a benchmark level for this greenhouse gas, we can determine the amount of CO2 that would end up in the atmosphere if there were no human activity on the planet. Suppose naturally occurring CO2 emissions are 5 million tons per year, the social discount rate is 5%, and the stock dissipation rate is 2%. What is the eventual level of CO2 in the atmosphere if these natural emissions continue at this rate forever? A) 100 million tons B) 250 million tons C) 25 million tons D) We do not have enough information to answer this question.