The AD-AS model implies that, in the long run,
a. the economy adjusts very quickly to demand shocks
b. changes in government spending have no effect on GDP
c. the price level never changes
d. a mixture of fiscal and monetary policy is necessary to achieve full employment
e. the Fed controls output
B
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Suppose you are given the following demand data for a product.PriceQuantity Demanded$1030940850760670The price elasticity of demand (based on the midpoint formula) when price increases from $7 to $9 is
A. elastic. B. inelastic. C. perfectly elastic. D. unit elastic.
The above table gives data for the nation of Sueland. What is the government sector balance?
A) $1,772 billion B) $32 billion C) -$43 billion D) -$32 billion
Which of the following statements best describes the neoclassical argument about unemployment and inflation?
a. Neoclassical economists argue that any short-term gains in lower unemployment will eventually vanish and the result of active policy will only be inflation. b. Neoclassical economists argue that any long-term gains in lower unemployment will eventually vanish and the result of active policy will only be inflation. c. Neoclassical economists argue that any short-term gains in lower unemployment will eventually vanish and the result of active policy will only be deflation. d. Neoclassical economists argue that any long-term gains in lower unemployment will eventually vanish and the result of active policy will only be deflation.
If the labor supply curve faced by a firm shifts to the right, the marginal factor cost curve of labor must be
A. rising and above the supply curve. B. horizontal. C. equal to the supply curve. D. rising and below the supply curve.