In recent years unemployment rates in several European countries have been higher than unemployment rates in the United States. Many economists believe that European unemployment rates have been higher because
A) European firms hire many seasonal workers from other countries, and this tends to inflate unemployment rates in their countries.
B) of the different methods used to measure unemployment. If similar methods were used, unemployment rates in Europe and the United States would be about the same.
C) the size of the military is much larger in the United States and all military personnel are classified as employed.
D) unemployment benefits are more generous in Europe than in the United States.
D
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The Fed has complete control over the money supply
Indicate whether the statement is true or false
The segmented markets theory can explain
A) why yield curves usually tend to slope upward. B) why interest rates on bonds of different maturities tend to move together. C) why yield curves tend to slope upward when short-term interest rates are low and to be inverted when short-term interest rates are high. D) why yield curves have been used to forecast business cycles.
The government purchases component of GDP includes:
A. interest payments on government debt. B. purchases of final goods and services. C. transfer payments. D. payments made to social security recipients.
Which of the following statements is true?
A. The speculative demand for money at possible interest rates gives the demand for money curve its upward slope. B. There is an inverse relationship between the quantity of money demanded and the interest rate. C. According to the quantity theory of money, any change in the money supply will have no effect on the price level. D. The transactions demand for money is used as an insurance agent against unexpected needs.