Convergence refers to closing the gap in ________ between poorer countries and richer countries
A) real GDP B) the growth rate in real GDP
C) real GDP per capita D) the growth rate in real GDP per capita
C
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New classical economists believe that the classical model
a. with the rational expectations assumption added provides a role for activist stabilization policies. b. is a poor starting point to construct new macroeconomic models. c. with the rational expectations assumption substituted for the perfect information assumption provides a starting point for constructing useful macroeconomic models. d. is equivalent to the monetarist model. e. both c and d.
Robert buys bonds. Rachel buys a new truck for her landscaping business. Identify both as savers, investors, both, or neither
What problems arise in interpreting unemployment data?
Refer to the diagram. Assume that the natural rate of unemployment is 5 percent and that the economy is initially operating at point a, where the expected and actual rates of inflation are each 6 percent. If the actual rate of inflation unexpectedly falls from 6 percent to 4 percent, then the unemployment rate will:
A. temporarily fall from 5 percent to 4 percent.
B. permanently fall from 5 percent to 4 percent.
C. temporarily rise from 5 percent to 7 percent.
D. permanently rise from 5 percent to 7 percent.