When an economy is at its natural rate of unemployment, which of the following will be true?
A) The unemployment rate will be 0%.
B) The labor force participation rate will be 100%.
C) The unemployment rate will be greater than 0%.
D) Only structural unemployment as a result of technological change will exist in the economy.
Answer: C
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In order to identify differences in preferences among various countries, one would look for evidence that
a. indifference curves from different countries cross.
b. prices for goods differ among countries.
c. different market baskets are chosen among different nationalities.
d. higher income countries choose baskets with more of all goods.
Describe the chain of events leading to exchange rate determination for the following cases:
(a) An increase in U.S. money supply (d) Increase in growth rate of U.S. money supply (c) Increase in world relative demand for U.S products (d) Increase in relative U.S. output supply
In the above figure, an increase in aggregate demand has resulted in
A. economic growth. B. an inflationary gap. C. a decline in the price level. D. a recessionary gap.
Voluntary agreements about cleaning up pollution attempt to
A. internalize private costs. B. externalize private costs. C. internalize externalities. D. externalize social costs.