In the classical model, an increase in the unemployment rate
A. will result in an increase in the price level if the reduction in output is caused by a change in aggregate demand.
B. is a signal of demand-pull inflation.
C. will persist when the reduction in output is caused by a reduction in aggregate demand.
D. will likely be temporary.
Answer: D
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You own $10,000 in personal property, $2,000 in Company X stocks, $1,000 in U.S. Savings Bonds and have $500 in your checking account. If Company X goes bankrupt, the most you could lose is
A) $13,500. B) $11,500. C) $2,000. D) $500.
If Howard takes out a $400 loan for one year at 5 percent interest annually, he will pay back a total of:
A. $400. B. $440. C. $420. D. $20.
The real balance effect is the change in
A) purchasing power that results from a change in income. B) the amount of money one has that results from a change in income. C) purchasing power that results from a change in the price level. D) the amount of money one has that results from a change in the price level. E) none of the above
A theory of regulatory behavior, which states that regulators must take into account the preferences of legislators, producers, and consumers, is the
A) capture theory. B) share-the-gains, share-the-pains theory. C) public interest theory. D) general interests theory.