With labor migration, the country of origin experiences:
A. An increase in output and a rising wage rate
B. An increase in output and a falling wage rate
C. A decrease in output and a falling wage rate
D. A decrease in output and a rising wage rate
D. A decrease in output and a rising wage rate
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In the above figure, flow B represents ________
A) household purchases of goods and services B) household borrowing C) household income D) firms' payments for labor services
One of the reasons why the Phillips curve is no longer viewed as a "menu" of possible choices available to policy makers is that
a. in the 1970s and 1980s there was no inflation at all. b. analysis indicates there was no such "menu" in the 1960s. c. in the 1970s and 1980s much inflation came from the supply side. d. economic theory is unable to explain the curve and, therefore, it has been rejected.
If the economy is producing a level of output that is consistent with the potential output level, and government purchases increase, describe what happens in terms of the long-run real interest rate, and why, to keep the economy at its potential output level.
What will be an ideal response?
A central bank announces it will decrease the inflation rate by 10 percentage points. People are skeptical of the announcement, but do expect the central bank will reduce inflation by 5 percentage points and so expected inflation falls by 5 percentage points. If the central bank decreases inflation by only 3 percentage points then the unemployment rate will fall
a. True b. False Indicate whether the statement is true or false