Those who favor an active approach to policy and those who favor a passive approach disagree not only on how quickly the government can act but also on how stable the economy basically is
a. True
b. False
Indicate whether the statement is true or false
True
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Economists Milton Friedman and E.S. Phelps suggested that the apparent trade-off suggested by the Phillips curve could not be exploited by policy makers, because
A) economic participants routinely incorporate changes in the inflation rate into their expectations. B) economic participants are not rational, and therefore act unpredictably to any policy change. C) unemployment levels and the inflation rate have a clear, positive relationship. D) unemployment levels and the inflation rate have a negative (inverse) relationship.
A competitive firm hires labour until the marginal product of labour equals the:
A. real wage. B. rental price of capital. C. price of output. D. capital/labour ratio.
Which of the following statements is correct?
A) Supply is more elastic in the short run than in long run. B) Supply is more elastic in the long run than in short run. C) Price elasticity of supply is constant along the supply curve. D) Price elasticity of supply is always a negative number.
The Federal Trade Commission was established in 1914 to
A) regulate trade of public goods. B) promote competition in interstate commerce. C) investigate unfair competitive practices. D) prevent non-price competition.