If the long-run Phillips curve is vertical, then any government policy designed to lower
unemployment will not change the unemployment rate and only increase the inflation rate.
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The marginal product of labor is the additional:
A. output produced by one more worker. B. wage paid for an additional worker employed. C. wage paid for an additional hour of work. D. labor employed to produce one more unit of output.
An economy experiencing an expansionary gap: a. operates in an environment in which labor shortages drive up money wages, real wages, and prices. b. has an excess supply of labor due to rising money wages and prices
c. will self-correct as rising money wages decrease faster than rising prices. d. will experience rising money wages and prices but falling real wages. e. will have excessive involuntary unemployment.
Data on unemployment indicate that most people who become unemployed will soon find jobs
a. True b. False Indicate whether the statement is true or false
Real GDP will increase
a. only when prices increase. b. only when output increases. c. when prices increase or output increases. d. All of the above are correct.