Assume the natural rate of unemployment in the U.S. economy is 5 percent and the actual rate of unemployment is 9 percent. According to Okun's law, the negative GDP gap as a percentage of potential GDP is
a. 2
b. 4
c. 6
d. 8
e. 10
d. 8
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Julie always purchases the soda with the lowest price. For Julie, the cross price elasticity of demand for brand X and brand Y will be
A) equal to 0. B) negative. C) positive. D) impossible to determine without more information.
According to the quantity equation, if M increases by 3 per cent and V increases by 2 per cent, then:
A. real income increases by approximately 5 per cent. B. the price level increases by approximately 5 per cent. C. the nominal interest rate increases by approximately 5 per cent. D. nominal income increases by approximately 5 per cent.
Shift to the left or right for supply: number of sellers decreases
What will be an ideal response?
A measure by which prices are expressed is a(n)
A. medium of exchange. B. unit of accounting. C. store of value. D. standard of deferred payment.