The equation, Unemployment rate = Natural rate of unemployment - a × (?ctual inflation - Expected inflation),
a. is the equation of the short-run Phillips curve.
b. implies the short-run Phillips curve shifts every time there is a change in actual inflation.
c. reflects the reasoning of Samuelson and Solow.
d. All of the above are correct.
a
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Economist C says all of the following: Expansionary fiscal policy is needed to raise aggregate demand and remove the economy from a recessionary gap. The choice of fiscal policy measures is between ________________ government spending and a _______________ in taxes. Since I am in favor of bigger government, I choose a(n) _________________ in _________________
A) less; decrease; increase; government spending B) more; decrease; increase; government spending C) less; rise; decrease; government spending D) less; reduction; increase; taxes E) b or d
Why do both households and societies face many decisions?
a) because resources are scarce b) because populations may increase or decrease over time c) because wages for households and therefore society fluctuate with business cycles d) because people, by nature, tend to disagree
Which of the following is the best example of a person NOT having clear property rights?
A) a city parks worker who inherits his uncle's town house B) a medical student who lives on campus for his first year of studies C) a retired college professor who builds a bungalow on her oceanfront property D) a dairy farmer who pays off the mortgage on his farm
What is the ECB prohibited from doing in the Eurozone?
A) raising tariffs on goods from nonmember countries B) directly financing member countries fiscal deficits C) increasing interest rates D) decreasing interest rates