Alternating periods of growth and contraction in real GDP define:
A. The business cycle.
B. Capitalism.
C. Inflation.
D. Macro equilibrium.
A. The business cycle.
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An increase in the money wage rate leads to
A) a rightward shift of the aggregate supply curve. B) a downward movement along the aggregate supply curve. C) an upward movement along the aggregate supply curve. D) a leftward shift of the aggregate demand curve. E) a leftward shift of the aggregate supply curve.
Refer to the production possibilities frontier figure above. Which of the following movements requires the largest opportunity cost, in terms of good X forgone, per extra unit of good Y?
A) from point e to point d B) from point d to point c C) from point c to point b D) from point b to point a
Abandonment of continual active discretionary counter-cyclical policies is advocated by
A) Keynesians. B) Monetarists. C) both Keynesians and Monetarists. D) neither Keynesians nor Monetarists.
If the functional form of the conditional variance function is incorrect, then
A) the standard errors computed by WLS regression routines are invalid B) the OLS estimator is biased C) instrumental variable techniques have to be used D) the regression R2 can no longer be computed