Which of the following explains the Phillips curve trade-off?
a. workers' focus on job security as the economy expands rapidly
b. firms weaken their resistance to wage pressure during periods of rapid economic growth
c. firms' ability to pass along higher wage rates in the form of higher prices during recessions
d. an unusual increase in resource supply
e. workers' insistence on wage increases during recessions to compensate for unemployment
B
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Answer the next question on the basis of the following information: Three goods are produced in an economy in the following amounts: A = 10, B = 30, C = 5. The current year per unit prices of these three goods are A = $2, B = $3, and C = $1.If the per unit prices of the three goods were each $1 in a base year used to construct a GDP price index, then real GDP in the current year is ________.
A. $160 B. $115 C. $45 D. $110
Which of the following activities creates a negative externality?
A) cleaning up a public garden in your neighborhood B) graduating from college C) keeping an old refrigerator on your front porch D) using a pooper-scooper every time you walk your dog
To sell more units, a monopolist must
A) merely produce more units. B) advertise more. C) produce the profit maximizing rate of production. D) lower price.
Price indexes:
A. allow us to convert nominal measures of output into real measures of output. B. let us measure how much real stuff we get for our money. C. like the CPI or GDP price deflator are used to measure the aggregate price level. D. All of these statements are true.