If a group of economists believes the following points are true, which is likely to be their policy making stance?
? Aggregate demand shocks have no long run effect on real Gross Domestic Product (GDP) or unemployment.
? Pure competition is widespread throughout the economy.
? Real wages are flexible.
? The Phillips Curve trade-off does not exist in the long run.
A) They will support discretionary policy making.
B) They will support passive policy making.
C) They will support active policy making.
D) They will argue that any attempt at economic policy making is futile.
B
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A trade-off between unemployment and inflation is reflected in the
A) economic stability. B) nonaccelerating inflation rate of unemployment (NAIRU). C) natural rate of unemployment. D) Phillips Curve.
In the above table, what is the marginal revenue product of the 4th worker?
A) $92 B) $70 C) $40 D) $8
According to the law of diminishing marginal utility, the fifth pair of gloves that Mary receives for Christmas makes her
a. as happy as she was while receiving the first pair b. less happy than she was while receiving the first pair c. more happy than she was while receiving the first pair d. consider that fifth pair as having zero marginal utility e. total utility decrease
Supply-side economists believe reductions in tax rates can
A) shift the aggregate demand curve to the left. B) shift the short run aggregate supply curve to the left. C) increase output and lower prices. D) decrease output and lower prices.