Which of the following types of unemployment can the classical model not explain?
a. Structural unemployment
b. Cyclical unemployment
c. Seasonal unemployment
d. Frictional unemployment
e. Temporary unemployment
B
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You use $50,000 of your own money to start an espresso stand. During the first year you earn a 10% return on that investment. If the current interest rate on savings is 8%, you earn an economic profit of
A. -$4,000. B. $1,000. C. $4,000. D. $5,000.
One reason governments impose taxes is to:
A. raise government revenues. B. increase consumer spending. C. spur economic growth. D. encourage more production.
Figure 4-21
At price P3 in Figure 4-21, what will tend to happen?
a.
There will be a shortage, and the price will fall.
b.
There will be a shortage, and the price will rise.
c.
There will be a surplus, and the price will rise.
d.
There will be a surplus, and the price will fall.
e.
Equilibrium will occur in the market.
Which of the following best describes a fiscal policy tool?
A. government spending B. bank lending C. financial capital markets D. household spending