When the economy is experiencing a negative output gap:
A. some people and some capital are unemployed.
B. the economy may be in a recession.
C. there is little inflationary pressure due to low demand.
D. All of these statements are true.
D. All of these statements are true.
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Due to a recession, Hostess Bakeries found that the demand for its products decreased. The demand for products ________ the demand for bakers and ________ the equilibrium wage rate paid to bakers
A) increased; raised B) decreased; raised C) increased; lowered D) decreased; lowered
Alan could most directly apply the principles of economic decision making with respect to his job when:
A. deciding how to spend his paycheck. B. deciding which girl to marry. C. deciding what to have for dinner after a long day at work. D. deciding which route on his way to work is the most scenic.
Suppose the natural rate of unemployment is 4 percent. What is the actual rate of unemployment if actual output is 2 percent above potential output?
A. 3 percent B. 6 percent C. 2 percent D. 0 percent
A basket of goods cost $100 in the U.S. and £65 in the United Kingdom. If purchasing power parity holds, what is the dollar-pound exchange rate?
What will be an ideal response?