The relationship between the unemployment rate and the natural unemployment rate is that the unemployment rate
A) fluctuates about the natural rate.
B) equals the natural rate.
C) is always below the natural rate.
D) is always above the natural rate.
A
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An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease
During the years 1979 to 1982, the Federal Reserve's announced policy was monetary targeting. During this time period the Federal Reserve
A) hit all of their monetary targets. B) did not hit any of their monetary targets because it is believed that controlling the money supply was not the intent of the Federal Reserve. C) did not hit any of their monetary targets because they were unrealistic. D) hit about half of their monetary targets.
Use the following table to answer the next question.YearNominal Income (dollars)CPIReal Income (dollars)1$44,600130 2$48,200 $35,1833$51,000139 What is the percentage change in real income from Year 2 to Year 3?
A. 4.3% B. 0.04% C. 5.8% D. 0.06%
In the long run, in a perfectly competitive industry:
A. economic loss tends to persist. B. the number of firms in the industry will increase. C. economic profit tends to persist. D. economic profit and loss are driven to zero by entry and exit.