In the economic way of thinking, the costs of a recession are predominantly
A) the costs of using money.
B) the excessive costs of advertising in the face of persistent, falling demand.
C) the costs of disappointed expectations and discoordination of plans.
D) the costs associated with high nominal interest rates.
C
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In the Great Recession of 2007-2009, the stock market values shrank, causing a reverse ________.
A. interest-rate effect B. wealth effect C. real-balances effect D. expectations effect
If the GDP deflator rises from one year to the next, we know that
A) economic growth has occurred. B) everyone in the economy is at least slightly worse off. C) real GDP has declined. D) the amount of double-counting in GDP has increased. E) the average money price of the goods included in GDP has risen.
Mike, Joe, and Sam are roommates. They need lamps for their common living room. Lamps in their living room are a public good for these roommates
The marginal benefit that each individual receives from varying numbers of lamps in the living room is given in the table above. If the marginal cost of a lamp is 13, what is the efficient number of lamps for the roommates to purchase? A) 2 B) 5 C) 0 D) 1
Full employment is not zero unemployment because
A) there are statistical errors when determining the unemployment rate that cannot be overcome. B) there is "normal" friction in the economy made up of those workers who are between jobs and those new entrants to the labor force. C) there are undocumented workers in the economy who are not counted by the Bureau of Labor Statistics. D) government workers are not counted in the labor force.