The neoclassical perspective on macroeconomics holds that the economy will fluctuate around its potential GDP and its natural rate of __________________ in the long run.
a. unemployment
b. production
c. supply
d. demand
a. unemployment
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If tolls on a toll road can be raised significantly before commuters will consider using a free alternative, then an increase in tolls will result in
A) an increase in total revenue. B) a decrease in total revenue. C) a decrease in non-toll road usage. D) an increase in toll road usage.
In reality, the long-run supply curve tends to be:
A. perfectly elastic. B. perfectly inelastic. C. upward sloping. D. downward sloping.
An aggregate supply curve that is a vertical line must be:
A. a short-run curve. B. a long-run curve. C. an individual firm's supply curve. D. an individual industry's supply curve.
According to the classical economists
A. a market economy should never experience unemployment. B. a market economy should never experience inflation. C. if unemployment appears, it would soon disappear because of a reduction in interest rates, wages, and prices. D. if inflation appeared it would soon disappear because of a reduction in interest rates, wages, and prices.