Unemployment that occurs when there is deficient demand for the goods and services of an economy is called:
A. Frictional unemployment
B. Cyclical unemployment
C. Structural unemployment
D. Natural unemployment
B. Cyclical unemployment
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One of the factors that contributed to the success German policymakers had using a monetary targeting type policy starting in the mid-1970s and continuing through the next two decades was that
A) they used a rigid target for the money growth rate. B) they implemented policy so their inflation rate goal was met in the short run. C) the money target was flexible to allow the Bundesbank to concentrate on other goals as needed. D) they rarely communicated the intentions of policy to the public in order to keep the public from panicking.
Suppose the yield curve is initially horizontal. Suppose the current one-year interest rate increases by 4% while the expected future one-year interest rate does not change. Which of the following will tend to occur?
A) i2t will increase by 4% B) i2t will increase by 2% C) i2t will increase by less than 2% D) i2t will decrease by 2%
If the price level rises, what will happen to the level of real GDP supplied?
a. It will usually decrease. b. It will usually increase. c. Nothing. d. It will decrease at first and then increase.
Which of these equations is correct?
A. APC - APS = 1 B. MPC + APS = 1 C. MPC + MPS = 1 D. 1 + MPC = MPS