The Phillips curve model suggests that a negative demand shock will raise unemployment and reduce inflation. A negative supply shock will have the same effect.
Answer the following statement true (T) or false (F)
False
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The price elasticity of demand for gasoline is estimated to be -0.2. Two million gallons are sold daily at a price of $1. Use this information to calculate a demand curve for gasoline assuming it is linear
What will be an ideal response?
The term economists use to describe a situation in which the economy's overall price level is rising is
a. growth. b. inflation. c. recession. d. expansion.
Recent productivity acceleration has been
What will be an ideal response?
Which of the following is TRUE with respect to specialization?
A. Individuals and nations specialize in their areas of comparative advantage in order to reap the gains of specialization. B. With a given set of resources, specialization results in higher output. C. Adam Smith in The Wealth of Nations referred to specialization and division of labor. D. All of these are correct.