When an economy is operating at its full employment rate of output:
a. the rate of unemployment will be zero.
b. output will exceed the economy's maximum sustainable rate.
c. the actual rate of unemployment will equal the natural rate.
d. the economy's potential rate of output will exceed actual GDP.
c
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The incidence of a tax:
A. indicates how much of the tax burden is borne by suppliers. B. indicates how much of the tax burden is borne by consumers. C. indicates how much of the tax burden is borne by various market participants. D. depends upon the shape of the supply curve only.
The gross domestic product (GDP) excludes: a. the value of a new building
b. the value of new stocks and shares. c. the cost of a new vending machine. d. government expenditure on a new bridge. e. the money spent on the purchase of legal services by a household.
During an expansion, which of the following occur because of automatic stabilizers?
I. Income tax revenues tend to rise. II. Government transfer payments tend to rise. III. The government's budget deficit tends to fall or its budget surplus tends to rise. IV. They tend to amplify the rise in real GDP. A) I and III only B) I, II, and III only C) I, III, and IV only D) I, II, III, and IV
A firm's total cost divided by its level of output is equal to its:
A. average total cost. B. marginal cost. C. variable cost. D. start-up cost.