The most significant cost to a central bank of reducing unemployment is the costs
a. incurred by printing and distributing new money.
b. of lower output.
c. of higher real wages.
d. of inflation.
D
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In the figure above, the economy is at an equilibrium with real GDP of $16 trillion and a price level of 110. At this point there is
A) an inflationary ga
If the marginal physical product of more labor is twice as high as the marginal physical product of more machinery, a rational firm should
A. reduce the labor used and increase the machinery used if labor costs half as much as machinery. B. reduce the labor used and increase the machinery used if labor and machinery cost the same amount. C. reduce the labor used and increase the machinery used only if labor costs more than twice as much as machinery. D. reduce the labor used and increase the machinery used only if labor costs exactly twice as much as machinery.
Which of the following reduces the interest rate?
a. an increase in government expenditures and an increase in the money supply b. an increase in government expenditures and a decrease in the money supply c. a decrease in government expenditures and an increase in the money supply d. a decrease in government expenditures and a decrease in the money supply
Which of these does not interfere with the price mechanism?
A. Usury laws B. Minimum wage laws C. Farm price supports, or price floors D. The law of supply and demand