If there is 2 percent frictional unemployment, 3 percent structural unemployment, and 1 percent cyclical unemployment, then the natural rate of unemployment equals:
A. 3%.
B. 6%.
C. 4%.
D. 5%.
Answer: D
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The increased entry of women and young people into the U.S. labor force from 1960–1980 led to
a. increased unemployment. b. reduced unemployment. c. a more experienced workforce. d. a more effective monetary policy.
Suppose that a firm in an industry subject to diminishing returns to scale is initially in long run equilibrium. Which of the following will not be part of the industry adjustment process to a permanent increase in demand? a. Some firms will temporarily make economic profits
b. Some new firms will enter. c. The long run equilibrium price will be higher than the initial equilibrium price. d. All of the above will be consequences.
The intent of parity pricing is to
a. protect small farms from predatory larger farms b. maintain farmers' purchasing power c. provide incentives for farmers to produce d. generate surplus food to feed the needy e. enhance the effects of technology in agriculture
If a firm knows that the demand for its product is inelastic, it could generate more revenue by:
A. lowering the price, because the resulting change in sales would be relatively large. B. raising the price, because the resulting change in sales would be relatively large. C. lowering the price, because the resulting change in sales would be relatively small. D. raising the price, because the resulting change in sales would be relatively small.