Why does unemployment arise and what makes some unemployment unavoidable?
What will be an ideal response?
In a dynamic economy some unemployment is unavoidable. For instance, growth means that some workers will always be entering the labor force without a job and therefore be unemployed. Consumers changing their demand for one good over another means workers in the newly less-favored industry will lose their jobs and also be unemployed. Moreover some workers will always be leaving their current job to search for a better job and these workers, too, will be unemployed. So some unemployment is unavoidable as the economy churns and reacts to changes.
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Suppose interest rates in foreign countries increase relative to the U.S. interest rate. As a result, there is ________ the demand curve for dollars
A) a downward movement along B) a leftward shift of C) a rightward shift of D) an upward movement along E) neither a movement along nor a shift of
Depreciation is defined as the
A) decrease in the stock of capital due to wear and tear. B) increase in the stock of capital due to investment by firms. C) increase in the stock of capital due to wear and tear. D) decrease in the stock of capital due to investment by firms.
The "Classical Dichotomy" refers to:
a. a distinction between "value in use" and "value in exchange." b. separate theories of demand and supply. c. the possibility of Giffen's Paradox. d. determination of relative prices independent of the nominal price level.
In constructing the short-run aggregate supply curve, we define the short run as the period in which: a. the price level is constant
b. output is fixed. c. profit is constant. d. the costs of some resources are fixed. e. the economic growth rate is less than 4 percent.