As the economy falls from the peak to the trough of the business cycle:
A. Inflationary pressures should increase as unemployment rises.
B. Cyclical unemployment should increase and real GDP should decline.
C. Frictional unemployment should fall because people find jobs more quickly.
D. Structural unemployment will be eliminated.
B. Cyclical unemployment should increase and real GDP should decline.
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It is possible for an economy to increase its production of both goods if the economy
a. moves downward and to the right along its production possibilities frontier and the frontier is bowed outward. b. moves upward and to the left along its production possibilities frontier and the frontier is bowed outward. c. moves in either direction along its production possibilities frontier and the frontier is a straight line. d. moves from a situation of inefficient production to a situation of efficient production.
Recall the Application about the effect of global warming on economic growth to answer the following question(s). According to this Application, over time, as economies adapt to higher temperatures:
A. approximately half the decline in per capita income disappears. B. approximately half the increase in per capita income disappears. C. per capita income does not seem to change. D. real income begins to increase and per capita income begins to decrease.
The conversion of resources into consumer goods or services is called
A) human capital. B) production. C) opportunity cost. D) consumption.
Refer to the information provided in Figure 32.1 below to answer the question(s) that follow.
Figure 32.1Refer to Figure 32.1. At point B
A. a decrease in tax rates will increase tax revenue. B. an increase in tax rates will increase tax revenue. C. any change in tax revenue will increase tax revenue. D. any change in tax rates will decrease tax revenue.