The market in which the equilibrium level of aggregate output is determined is the
A) labor market.
B) bond market.
C) money market.
D) goods market.
Answer: D) goods market.
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Refer to Table 17-1. Suppose the output price is $3. If the wage rate is $90, what is the profit-maximizing quantity of labor that the firm should hire?
A) 7 units B) 5 units C) 4 units D) 3 units
Figure 2-10
Consider the production possibilities frontier for food and clothing in . A movement from point J to point K could be caused by
a.
the development of new and better technology
b.
increasing unemployment
c.
the movement of society into a recession
d.
the law of increasing opportunity costs
e.
eliminating productive inefficiency
If Tom drives a car more recklessly after he purchases a comprehensive insurance plan, the change in his behavior is an adverse selection problem.
Answer the following statement true (T) or false (F)
Assume an economy experiences, for a given period, a 4% increase in output and a 4% increase in productivity. Given this information, we know that which of the following occurred for this economy during this period?
A) The unemployment rate increased during this period. B) The unemployment rate decreased during this period. C) The unemployment rate did not change during this period. D) The effects on the unemployment rate are ambiguous. E) none of the above