Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential
B. expansionary; higher; potential
C. recessionary; lower; potential
D. recessionary; lower; lower
Answer: C
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Which of the following will most likely occur during the expansionary phase of a business cycle?
a. Real GDP declines, and the rate of unemployment increases. b. Real GDP declines, and the rate of inflation is unchanged. c. Real GDP increases, and rate of unemployment falls. d. Real GDP is unchanged, and the rate of inflation is unchanged.
Which of the following is true of matrix organizations?
A. Employees are more likely to focus on the overall business process rather than on their functional specialty. B. Influence costs are low as there are separate product and functional managers. C. Employees have strong incentives to cooperate with other teams within a company. D. There are well-defined lines of authority, eliminating scope of interdependence and lack of incentives.
Which of these would NOT be considered a middleman in a market?
A) a produce wholesaler B) a wheat farmer C) a cellphone retailer D) a meat distributor
After the Arab oil embargoes, there was concern about the impact of higher gas prices on the low-income worker. The government imposed price controls on oil to protect the poor from this situation. Explain the inefficiency of this price ceiling and how taxes, rather than prices, could be used to solve the problem