Below are pairs of GDP growth rates and unemployment rates. Economists would be shocked to see most of these pairs in the U. S. Which pair of GDP growth rates and unemployment rates is realistic?
a. 5 percent, 1 percent
b. 3 percent, 5 percent
c. -1 percent, 3 percent
d. -2 percent, 4 percent
Answer: b. 3 percent, 5 percent
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In the Keynesian model, the full-employment level of output is the amount of output produced when
A) the quantity of labor demanded equals the quantity of labor supplied. B) the market wage exceeds the efficiency wage. C) labor is paid an efficiency wage, and the real wage equals the marginal product of labor. D) the real wage exceeds the nominal wage.
If price rises, what happens to the quantity demanded for a product?
a. It increases. b. It decreases. c. It does not change. d. Uncertain--economic theory has no answer to this question.
The number of years it takes for GDP to double is found by
A. Multiplying 72 by per capita GDP. B. Dividing the growth rate by 72. C. Dividing 72 by the growth rate. D. Multiplying 72 by the growth rate.
Anna enters the workforce after being unemployed for a year. How would this be shown on her consumption function?
A. Movement down the consumption function B. Shift upward of the function C. Shift downward of the function D. Movement up along the consumption function