Suppose an economy's trend growth rate is 3 percent and current output is $10 trillion. If the economy enters a recession where output declines by 5 percent in one year, by how much does output have to rise to return to its trend? Assume it takes two years for the economy to return to its trend.
A. $1.7 trillion
B. $1.4 trillion
C. $0.5 trillion
D. $0.6 trillion
Answer: B
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A) 0.33 greeting cards B) 1 greeting card C) 1.45 greeting cards D) 3 greeting cards
The "Big Mac Theory of Exchange Rates" tests the accuracy of purchasing power parity theory. In July 2015, the Economist reported that the average price of a Big Mac in the United States was $4.79
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According to John Maynard Keynes people hold money for each of these reasons except the _____ motive.
A. precautionary B. price C. speculative D. transactions
Refer to the below table for a profit-maximizing firm. The price of the firm's product is $10 per unit and the wage rate is a constant $110 a day. How many workers will the firm hire, assuming purely competitive product and resource markets?
A. 4
B. 5
C. 6
D. 7