Which of the following groups believes that the economy can achieve full employment without inflation through tax reductions, lower resource prices, and deregulation?
a. Classical school.
b. Keynesian school.
c. Neo-Keynesian school.
d. Rational expectations school.
e. Supply-side school.
e
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Contractors can use plywood or brick to construct walls. Suppose the price of bricks increases. Which of the figures above best illustrates the effect of this change on the market for plywood?
A) Figure A B) Figure B C) Figure C D) Figure D E) Figure A or Figure C depending on how contractors react to the higher price of bricks.
Refer to Table 9-11. If the actual terms of trade are 1 hat for 1.8 clocks and 150 hats are traded, how many hats will Denmark consume?
A) 150 B) 180 C) 270 D) 400
Why is there a price markup over marginal cost in monopolistic competition?
What will be an ideal response?
In a saving—investment diagram for a small open economy
A) the saving curve is vertical at some fixed level of output. B) the saving curve is horizontal at some fixed interest rate. C) the real interest rate is fixed at the world real interest rate. D) equilibrium requires that Sd = Id.