During an economic boom, actual output exceeds potential output.
Answer the following statement true (T) or false (F)
True
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When people use all the relevant data and principles of economics to forecast inflation, they are making
A) what is called a "data-based forecast." B) an always accurate forecast. C) a mistake. D) what is called a "rational expectation." E) an exaggerated forecast.
Downward shifts are a. increases in both demand and supply
b. decreases in both demand and supply. c. increases in demand and decreases in supply. d. increases in supply and decreases in demand.
Economists use assumptions in order to
A. make models more realistic. B. simplify complex real-world behavior. C. make their models fit the data. D. avoid using mathematics.
"Unemployment increased in the last month to its highest level in the past ten years." This quote would be an example of:
a. A normative economic statement b. A positive economic statement c. The fallacy of composition d. Post hoc, ergo propter hoc fallacy