A trough in the business cycle occurs when
A. the inflation rate is at its lowest level.
B. the natural rate of unemployment is at a minimum point.
C. cyclical unemployment is at a minimum point.
D. employment and output reach their lowest levels.
Answer: D
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The velocity of money is defined as
A) real GDP divided by the money supply. B) nominal GDP divided by the money supply. C) real GDP times the money supply. D) nominal GDP times the money supply.
In the classical model, when an open economy has balanced trade, Say's law holds
a. True b. False
For a typical product, an increase in consumer income will cause the market demand for the product to
a. decrease, which is a shift to the left of the demand curve. b. decrease, which is a shift to the right of the demand curve. c. increase, which is a shift to the left of the demand curve. d. increase, which is a shift to the right of the demand curve.
The theory that there are no predictable trends in securities prices that can be used to "get rich quick" is the
A) dartboard theory. B) random walk theory. C) Wall Street theory. D) inefficient market hypothesis.