Which of the following is a normative economic statement?
A. An increase in corporate income taxes will cause the unemployment rate to increase.
B. Teenage unemployment is too high for the United States.
C. The costs of medical care are increasing faster than the incomes of U.S. citizens.
D. Teenage unemployment is over 12 percent today.
Answer: B
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Export-led growth policy involves:
A. encouraging private investment in industries that currently export goods, rather than those expanding domestically. B. favoring industries that export goods over those that only produce domestically consumed goods through high tariffs. C. discouraging imports with high tariffs. D. investing heavily in industry through tax breaks and export subsidies with the aim of selling goods around the world.
Suppose that the percentage change in demand is 10%, the price elasticity of demand is 2, and the price elasticity of supply is 2. The equilibrium price will:
A. decrease by 2.5 percent. B. increase by 40 percent. C. increase by 2.5 percent. D. decrease by 40 percent.
In the figure above, assume that output is $10.5 trillion, while potential output is $12 trillion
If autonomous monetary policy (alone) is used to bring output to $12 trillion, then the figure implies that the real interest rate will be ________ percent, and the inflation rate will be one percent. A) 1.5 B) zero C) one D) 0.5 E) 2.5
The incidence of absolute poverty is reduced by
A) annual recalculations of the poverty line. B) government welfare programs. C) economic growth. D) the size of the budget deficit.