Cyclical unemployment is a consequence of:
What will be an ideal response?
a decline in total spending and decline in aggregate spending
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Suppose that Harold buys collision insurance for his car and then drives it recklessly. This is an example of:
A. a positive spillover. B. moral hazard. C. adverse selection. D. irrational behavior.
The difference between the gross public debt and the net public debt is that the
A. gross public debt includes entitlements while the net public debt does not. B. gross public debt includes government interagency borrowing while the net public debt does not. C. the gross public debt is expressed as a percentage of GDP while the net public debt is not. D. gross public debt is based on budget deficit while the net public debt is not based on budget deficits.
According to supply-side economists, as tax rates are increased, labor supply should decrease. This implies that the substitution effect of a wage change ________ the income effect of a wage change.
A. is equal to B. has no impact on C. is greater than D. is less than
As the aggregate price level in an economy rises, ______.
a. interest rates increase b. consumer demand increases c. exports decrease d. investment increases