Real business cycle and new Keynesian models disagree upon
a. whether people form their expectations rationally.
b. whether changes in unemployment are voluntary or involuntary.
c. whether individuals engage in optimizing behavior at all times.
d. whether changes in the money supply affect output in the long-run.
B
You might also like to view...
The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Julia knows that the price elasticity of movie rentals is 3. She knows, therefore, that if she raises her price from $2 to $2.50, her rentals will drop by approximately
A. 150 percent. B. 100 percent. C. 75 percent. D. 33 percent.
In a sealed-bid, second-price auction, you should bid
A) your estimate of what others value the good at. B) one dollar more than your estimate of what the second-highest bid will be. C) your highest value. D) the common value of the good.
If an economy produces final output worth $5 trillion, then the aggregate income generated by that production: a. will be $5 trillion
b. will be more than $5 trillion. c. will be $5 trillion minus taxes. d. will be less than $5 trillion. e. will be $5 trillion plus transaction costs.