Economists estimate the target rate of unemployment in order to determine:
A. the level of output.
B. the inflation rate.
C. the unemployment rate.
D. potential output.
Answer: D
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Saving is not a problem in the classical model because
A) savers and investors are the same people. B) interest rates are flexible, and savings were channeled into investment. C) the classical economists assume that saving was beneficial to people for retirement. D) saving would be spent by consumers eventually.
Which of the following statements is true?
A) In cases of auctions and bilateral negotiations, prices tend to approach the competitive equilibrium. B) Bilateral negotiations allow a single buyer and a single seller to privately negotiate with bids and asks. C) In auctions, buyers prefer buying from sellers with the highest ask prices. D) In auctions, sellers prefer selling to buyers with the lowest bid prices.
An increase in the interest rate will
A) decrease the price of bonds. B) increase the price of bonds. C) increase or decrease the price of bonds depending upon whether the money supply has increased or decreased. D) leave the price of bonds unchanged.
A decrease in price will cause a firm's total revenue to decrease if demand is price inelastic
a. True b. False Indicate whether the statement is true or false