The Phillips curve shows that when the unemployment rate is lower than the natural rate,
A) inflation is higher than expected.
B) inflation is lower than expected.
C) policy rate is higher than expected.
D) policy rate is lower than expected.
A
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A movement along the MP curve ________
A) implies an automatic adjustment of the interest rate B) implies an autonomous adjustment to the interest rate C) implies an autonomous adjustment of aggregate demand D) all of the above E) none of the above
China is a clear example of a country that has:
A. achieved economic growth without a democratic regime. B. achieved economic growth only after a democratic regime was in place. C. failed to achieve economic growth without a democratic regime. D. failed to achieve economic growth, despite having a democratic regime.
The traditional view of the production process is that capital is subject to
a. constant returns. b. increasing returns. c. diminishing returns. d. diminishing returns for low levels of capital, and increasing returns for high levels of capital.
The tendency for marginal utility to decline as consumption increases beyond some point is called:
A. utility maximization. B. the rational spending rule. C. the law of demand. D. the law of diminishing marginal utility.