The political business cycle refers to the possibility that:
A. incumbent politicians will be reelected regardless of the state of the economy.
B. politicians will manipulate the economy to enhance their chances of being reelected.
C. there is more inflation during Democratic administrations than during Republican
administrations.
D. recessions coincide with election years.
B. politicians will manipulate the economy to enhance their chances of being reelected.
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Is the developing world moving toward centralized planning or free markets? Justify your answer
What will be an ideal response?
Economic models do all of the following except
A) simplify some aspect of economic life. B) answer economic questions. C) make economic ideas explicit and concrete for use by decision makers. D) portray reality in all its minute details.
The "tech bubble" burst of 2000, the terrorist attacks of 2001 and the corporate scandals of 2001 and 2002 all had similar qualitative effects on the economy
Which of the following is an appropriate description of the mechanism that would have ensued? A) Household and business spending would have been eroded shifting the AD curve to the left. B) Unemployment would have risen and inflation would have fallen. C) Output would have declined below potential but through shifts in the AS curve, the self-correcting mechanism of the AD-AS framework would have brought the unemployment rate down to the lower levels we saw by 2004. D) all of the above E) none of the above
Which of the following is a short run adjustment? a. A bakery hiring two additional bakers
b. Two new firms enter the textile industry. c. Three firms leave the bicycle industry. d. A computer hardware company builds a new factory.