How are unemployment, inflation, and the business cycle related?
What will be an ideal response?
A recessionary phase of a business cycle usually begins with decreased investment spending by firms or with reductions in consumption spending. As spending decreases firms' sales decrease, and firms begin laying off workers, thereby increasing unemployment. As firms find it more difficult to sell their goods they will also find it more difficult to raise prices and the rate of inflation will be relatively low. As the economy moves toward the expansionary phase of the business cycle firms begin to increase investment spending, households begin to increase their spending, and unemployment begins to fall. As spending increases producers find it easier to raise prices and the rate of inflation tends to rise during this expansionary phase.
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Why do some firms choose not to file for a patent and instead try to keep the results of their research a trade secret?
A) because firms must disclose information about the product or process being patented in a patent application B) because a patent only gives the inventor exclusive rights to a product or process for 5 years C) because trade secrets provide the same exclusive legal rights to a product as a patent does D) because trade secrets are never divulged
As a consequence of the problem of scarcity
A. only some people can "have it all." B. there is never enough of anything. C. individuals have to make choices from among alternatives. D. things that are plentiful have relatively high prices.
As an economy's capital stock increases, the economy
A) generally experiences increased unemployment of other resources, such as labor. B) generally decides to engage in international trade. C) experiences economic growth. D) gains an absolute advantage in the production of capital goods.
Inflation is measured
A) as the percentage change in the consumer price index. B) as the percentage change in real GDP. C) using the level of real GDP. D) using the level of the consumer price index.