In the short run, an unexpected increase in the inflation rate leads to.
A) A higher unemployment rate.
B) A decrease in aggregate demand.
C) A lower unemployment rate.
D) Workers thinking the money wage rate has fallen.
Ans: C) A lower unemployment rate.
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The automatic budget surpluses and budget deficits that occur in the federal budget over the business cycle
A) stabilize the economy. B) destabilize the economy. C) decrease potential GDP. D) increase potential GDP.
Assume that you know the following cost information about Fred's widget company: Its fixed cost is $9, and its total variable cost is $6 for 1 unit; $11 for 2; $ 15 for 3; 20 for 4; and 26 for 5 . Given the above information, a. the marginal cost of the third unit is greater than the marginal cost of the first unit. b. the marginal cost of the fourth unit is the same as the marginal cost of the
second unit. c. the average variable cost of four units is the same as for three units. d. both (b) and (c) are correct.
In a competitive market, a decrease in consumer demand leads to
a. a decrease in output b. an increase in output c. economic profits d. higher prices e. technological innovation
What is the difference between Nominal GDP and Real GDP?
a. Real GDP only measures the production of real goods and excludes services of any kind. b. Real GDP is a figure adjusted for exchange rate differences among countries. c. Real GDP is a figure adjusted for inflation. d. There is no difference at all. Real GDP is a synonym for Nominal GDP. e. Real GDP measures goods and services produced within a nation's borders, and nominal GDP measures goods and services produced by domestic resources anywhere in the world