In what sense is frictional unemployment "good" for the economy?
What will be an ideal response?
Since frictional unemployment is the unemployment that exists so that workers and firms find the right matches, the economy needs some frictional unemployment to operate efficiently.
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The Fed's open market operations involve
a. buying and selling of government bonds b. changes of the discount rate c. setting the required reserve ratio d. buying and selling corporate bonds e. a policy of last resort used to avert a financial crisis
An income tax increase in the Virgin Islands will cause the Islands'
a. consumption curve to shift downward b. consumption curve to shift upward c. investment curve to shift upward d. investment curve to shift downward e. economy to move to the right along its current investment curve
Which of the following best describes the relationship between economic freedom and real per capita Gross Domestic Product (GDP)?
A) As economic freedom increases, real per capita GDP decreases. B) As economic freedom increases, real per capita GDP increases. C) As economic freedom decreases, real per capita GDP increases. D) There are too many extraneous factors involved to discern a direct relationship.
Table 21.2Output (units per day)0102030Total cost (dollars per day)$40$54$62$80At 10 units of output in Table 21.2, the total fixed cost is
A. $54. B. $40. C. $44. D. $14.