Which of these policy rule variables does NOT have the disadvantage of being hard to control?
A) nominal GDP growth
B) high-powered money
C) the unemployment rate
D) the inflation rate
D
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Suppose the economy is operating below potential output. If policy makers try to avoid a budget deficit by raising taxes or reducing government spending, these actions would
A) make a recession worse. B) increase inflation. C) negate the multiplier effect. D) help pull an economy out of a depression.
Suppose the official unemployment rate is 10 percent. We can conclude without question that
In 1962, Michael Harrington argued in The Other America that there was chronic, severe poverty in America
a. True b. False Indicate whether the statement is true or false
Which of the following is definitely true if the production possibilities curve shifts outward?
A. Aggregate supply has increased. B. Population has increased. C. GDP per capita has increased. D. Inflation has increased.