Suppose the economy is self-regulating and the (actual) unemployment rate is less than the natural unemployment rate. This means that the economy is producing a level of output
A) above its natural level and will eventually cut back on output.
B) below its natural level and will eventually increase output.
C) below its natural level but no forces exist to automatically increase output.
D) above its natural level and institutional constraints will automatically be reduced so as to allow the economy to continue producing this level.
E) none of the above
A
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Which of the following is a tool that is used by the Fed to control the quantity of money?
A) open market operations B) excess reserves C) government expenditure multiplier D) real interest rate
For a monopsony, the labor supply curve is
A) above the MCL curve. B) always below the VMP curve. C) downward sloping. D) upward sloping.
A one-year discount bond with a par value of $5000 sold today, at issuance, for $4750 has a yield to maturity of
A) 5.00%. B) 5.26%. C) 2.50%. D) 9.75%.
Suppose the U.S. dollar gains strength against the euro (and against other major currencies). This strengthening of the dollar will cause which of the following to occur?
A) The aggregate demand curve will shift to the right and the short-run aggregate supply will shift to the right. B) The aggregate demand curve will shift to the left and the short-run aggregate supply will shift to the right. C) The aggregate demand curve will shift to the right and the short-run aggregate supply will shift to the left. D) the aggregate demand curve will shift to the left and the short-run aggregate supply will shift to the left.