Suppose there are 5 million unemployed workers seeking jobs. After a period of time, 1 million of them become discouraged over their job prospects and cease to look for work. As a result of this, all else equal, the official unemployment rate would
A. be unchanged.
B. increase in the short run but eventually decline.
C. increase.
D. decline.
Answer: D
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Suppose real GDP is $13 trillion, potential real GDP is $13.5 trillion, and Congress and the president plan to use fiscal policy to restore the economy to potential real GDP
Assuming a constant price level, Congress and the president would need to increase government purchases by A) less than $500 billion. B) $500 billion. C) more than $500 billion. D) None of the above are correct. Congress must act to decrease government purchases in this case.
An inefficient use of resources can be illustrated using a production possibilities curve as: a. a movement to the northeast along the curve
b. a movement to the southeast along the curve. c. a movement off the curve in a northeast direction. d. a movement off the curve in a southwest direction.
Which of the following is an example of entrepreneurship?
A) a student who produces and sells t-shirts at a football game B) all of the above C) an employee who figures out how to make her services more valuable to the business for which she works D) a 15-year old who operates a lemonade stand during hot summer days
Which of the following is NOT considered a measure of firm conduct?
A. Lerner index of pricing behavior B. Research and development measures C. Dansby-Willig index D. Advertising measures