The economy's normal, long-run growth rate is shown in the AD-AS model as:
A. the upward-sloping SRAS curve.
B. the vertical LRAS curve.
C. the vertical SRAS curve.
D. the horizontal LRAS curve.
Answer: B. the vertical LRAS curve.
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What is the most accurate description of skilled and unskilled workers if labor supply curves are not perfectly inelastic (perfectly vertical)?
a. If the two types are complements, then the increases in immigration during the late 1800s would have increased the quantity and wages of skilled workers and decreased the wages of unskilled workers. b. If the two types are substitutes, then the increases in immigration during the late 1800s would have increased the quantity and wages of skilled workers and decreased the wages of unskilled workers. c. If the two types are complements, then the increases in immigration during the late 1800s would have increased wages of skilled workers, decreased the number of skilled workers, and decreased the wages of unskilled workers.
Most empirical studies show that the cost-savings provided by managed care are accomplished by
a. better preventive care. b. reducing the rate of hospitalization. c. denying access to costly specialty care. d. switching to generic drugs. e. all of the above.
Which of the following is an example of a physical constraint?
a. The work you can perform on 1,500 calories a day. b. The wages you can earn against each hour of work. c. The bank balance of an individual at any point of time. d. The contract price at which you agree to sell your house.
What is meant by the term inflation bias?
A) when policymakers allow exchange rates to continually depreciate and are willing to accept higher rates of inflation B) when policymakers accept higher rates of inflation and are willing to allow exchange rates to continually depreciate C) when policy makers use expansionary monetary policy for short-term gain, at the expense of higher inflation in the longer run D) when fiscal policymakers use deficit financing to stimulate the economy at the expense of higher long-run inflation