Possible reasons why the level of employment remained lower than before the Great Recession began, even three years after the recession ended, includes the following, except:
A. There was an extension of the period of eligibility for unemployment benefits
B. Structural adjustments that were needed were happening very slowly, if at all
C. Worries about rising labor costs were dampening the willingness of firms to increase hiring
D. The production of output continued to decline, so that firms had no real need to increase hiring
D. The production of output continued to decline, so that firms had no real need to increase hiring
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The figure above shows the market for coffee. Coffee is a normal good. If consumers' incomes fall, the efficient quantity of coffee will ________ and the producer surplus will ________
A) increase; increase B) increase; decrease C) decrease; decrease D) decrease; increase
To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.
In the above table, the cross price elasticity of demand (using averages) for C with good A, when PA increases from $12 to $15, is approximately equal to
A. +1.03 B. +0.44. C. -0.44. D. +2.26.
Labor hoarding occurs when
A. because of hiring and firing costs, firms retain workers in a recession that they would otherwise lay off. B. involuntary unemployment exceeds voluntary unemployment. C. the unemployment rate exceeds the natural rate of unemployment. D. firms keep good workers so other firms can't hire them.