When the economy is at full employment the
A) natural unemployment rate is equal to 0 percent.
B) natural unemployment rate equals the unemployment rate.
C) natural unemployment rate is equal to 10 percent.
D) unemployment rate is equal to 0 percent.
B
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Refer to Figure 7.1. Suppose that instead of $350, Angus earns only $250 by playing the bagpipes, but all other earnings remain the same. If there is no ordinance against loud music, the Coase theorem predicts that
A) Dudley will pay Angus to not play the bagpipes. B) Angus will pay Dudley so Angus can play the bagpipes. C) Dudley will do nothing and Angus will mop floors. D) no bargain can be reached between Angus and Dudley.
What are social costs? How do they differ from private costs?
What will be an ideal response?
Which of the following would NOT be a short-run decision for the firm?
A) Recall workers who were previously laid-off. B) Have labor work two hours overtime each day in order to expand output C) Build another wing on the plant in order to add a new assembly line. D) Place an order with a supplier for additional raw materials.
In the economy as a whole, lower interest rates are likely to ________ investment and higher interest rates are likely to ________ investment.
A. slow; stimulate B. stop; stimulate C. stimulate; slow D. stimulate; stop