Assuming that the rational expectations hypothesis is NOT in effect, in the short run an expansionary monetary policy should
A) generate stagflation.
B) shift the aggregate supply function.
C) increase real Gross Domestic Product (GDP) and the price level.
D) increase the rate of unemployment.
C
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Last year, Casey grew fresh vegetables, which she sold at her local farmers market, but this year, Casey did not plant any vegetables and went to work at a bank instead. Which of the following best explains Casey's career change?
A. Casey's opportunity costs of gardening exceeded Casey's opportunity costs of working at the bank. B. Casey's opportunity costs of working at the bank exceeded Casey's benefits from gardening. C. Casey's opportunity costs of gardening exceeded Casey's benefits from working at the bank. D. Casey's opportunity costs of working at the bank exceeded Casey's opportunity costs of gardening.
Which of the following is most likely to have an income elasticity of demand that is less than 1?
A) movies B) airline travel C) foreign travel D) food E) restaurant meals
A price taker is a buyer or seller who:
A. cannot affect the market price. B. takes the market price and chooses to increase or decrease it. C. takes prices in the area and averages them together to set the price for his/her good. D. can affect the market price, but only when collaborating with other buyers or sellers.
Which of the following is an example of structural unemployment?
A. Alan, a software engineer, lost his job when the internet startup he worked for went bankrupt. He interviewed with five companies in the area before taking a job with another firm in the industry. B. Jim had a job as an engineer, but quit when his wife was transferred to another state. He looked for a month before finding a new job that he liked. C. Marsha was laid off from her job with the airline because the recession has reduced the demand for airline travel. She expects to get her job back when the economy picks up. D. Dora lost her job when the textile factory closed. She does not have skills to work in another industry and has been unemployed for over a year.