If a natural disaster were to cause a negative long-run supply shock to the economy, once the economy adjusts, the new equilibrium will be at a:
A. higher price level and lower level of output.
B. lower price level and lower level of output.
C. higher price level and higher level of output.
D. lower price level and higher level of output.
Answer: A
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Economists say that the economy is at "full employment" when the
A) total unemployment rate is zero. B) structural unemployment rate is zero. C) cyclical unemployment rate is zero. D) frictional unemployment rate is zero.
Under the natural rate hypothesis, expansionary monetary and fiscal policies can at best produce a:
a. permanent change in the unemployment rate. b. short-run change in the unemployment rate. c. permanent change in the inflation rate. d. short-run change in the long-run Phillips curve.
Exhibit 7-5 Workers and output data Laborers TotalProduct 0 0 1 8 2 20 3 25 4 28 5 29 In Exhibit 7-5, diminishing returns set in when the ____ worker is hired.
A. first B. second C. third D. fourth
Discuss the political pressures associated with monetary policy. What has the United States done to try to reduce these political pressures?
Please provide the best answer for the statement.