How do economists explain the shape of the Phillips curve? By arguing that
a. supply shocks and stagflation are inversely related
b. changes in the money supply cause prices to increase
c. when high rates of GDP growth occur, firms are willing to pay higher wage rates and are able to raise prices as well
d. firms' profits rise when plant capacity increases
e. wage and price controls work, at least in the short run
C
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Refer to the figure above. When the demand curve for gas is D2 and the supply curve for gas is S, the surplus in the market when price is $8 is:
A) 20 gallons. B) 55 gallons. C) 25 gallons. D) 50 gallons.
"Given the long run implication of Solow's growth model with respect to the rate of savings, the low savings rate in the United States is not a problem." This statement overlooks that over time it appears that
A) total factor productivity and the growth rate of capital per person are positively related. B) total factor productivity and the growth rate of capital per person are inversely related. C) total factor productivity and the difference between the growth rates of capital per capita and population are not related a and k - n are not related. D) savings rates and per capita growth rates are inversely related.
Refer to Table 9-11. Prior to trade, what was the opportunity cost to produce 1 clock in Denmark?
A) 1/6 of a hat B) 1/2 of a hat C) 2 hats D) 6 hats
A decrease in the interest rate will: a. increase the amount of money borrowed by firms
b. decrease the amount of money borrowed by firms. c. have an ambiguous effect on the amount of money borrowed by firms. d. have no effect on the amount of money borrowed by firms.