Cyclical unemployment arises when
A. unskilled or low-skilled workers find it difficult to obtain desirable, long-term jobs.
B. output and employment are below full-employment levels.
C. labor must be reallocated from industries that are shrinking to areas that are growing.
D. workers must search for suitable jobs and firms must search for suitable workers.
Answer: B
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Suppose that the quantity of root beer demanded declines from 103,000 gallons per week to 97,000 gallons per week as a consequence of a 10 percent increase in the price of root beer. The price elasticity of demand is
A) 0.60. B) 1.40. C) 1.66. D) 6.00.
Suppose you paid $500,000 for an asset. You hold the asset for five years. The interest rate that you get for the asset is 10%. Assume the tax rate on capital gains is 20%.
(A) If capital gains are taxed only when the asset is realized, how much will you have earned on the asset? (B) Suppose that capital gains are taxed annually instead of at realization. How much will you have earned on the asset? (C) How big is the difference in the two taxing schemes?
Which resource is the main contributor to economic growth in the United States, Latin America, and South Asia?
A) growth in physical capital B) growth in human capital C) growth in labor D) growth in natural resources
Which of the following is included in both the balance of trade and the balance of payments?
A) exports B) earnings on domestic assets owned by foreign residents C) international capital movements D) earnings by domestic residents on assets located abroad