The aggregate supply curve shows the relationship between ____ and ____, holding all other factors constant
a. price level; quantity of real GDP supplied
b. price level; supply of nominal GDP
c. nominal GDP; price level of real GDP
d. price level; amount of nominal GDP supplied
a
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
If an electric power plant does not bear the entire cost of the pollution it emits, it will
a. not emit any pollution so as to avoid the entire cost of the pollution. b. emit lower levels of pollution. c. emit an acceptable level of pollution. d. emit too much pollution.
The lag between the time at which a policy is put in place and the time that policy affects the economy is called
A) the recognition lag. B) the impact lag. C) the implementation lag. D) the theoretical lag.
If the unemployment rate for the United States economy rises from 7 to 11 percent during a year, we can conclude that:
a. Actual GDP is less than potential GDP b. The natural rate of unemployment for the United States economy has risen c. The economy is experiencing only frictional unemployment d. Actual GDP exceeds potential GDP