You have noticed that there is a persistent shortage of teachers in an inner-city school district in your state. Based on this observation, you suspect that:
A. the wage for teachers in that district is lower than the equilibrium wage.
B. the demand for teachers in the inner-city school district is too low.
C. there is an excess supply of teachers in other districts.
D. the wage for teachers in that district is higher than the wage in other districts.
Answer: A
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Expansionary fiscal policy uses ________ government spending and ________ taxes to increase aggregate economic activity
A) lower; lower B) higher; lower C) higher; higher D) lower; higher
Refer to Figure 9.1. Assume the economy is initially at point A. The eventual change from a shock that increases investment expenditure is best represented by which long-run equilibrium combination of price level and real GDP?
A) P2; Y2 B) P3; Y1 C) P1; Y2 D) P2; Y1
The sales of the 50 largest corporations in the U.S. economy amount to nearly 31 percent of GDP in 2017.
Answer the following statement true (T) or false (F)
One of the advantages of floating exchange rates is that:
a. consumers always know how much imported goods cost. b. businesses always know, in advance, what future exchange rates will be. c. countries are free to pursue their own macroeconomic policies without maintaining exchange rates. d. countries cannot act independently and must thus coordinate their macroeconomic policies. e. the global interest rate tends to decline to the lowest possible level.