The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier.
B. self-correcting property.
C. short-run equilibrium property.
D. long-run equilibrium property.
Answer: B
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In perfect competition, marginal revenue
A) increases as more is sold. B) decreases as more is sold. C) is equal to the market price. D) is zero. E) is always greater than marginal cost.
Which of the following would decrease the unemployment rate?
A) government aid to retrain unemployed workers B) an increase in the efficiency wage C) an increase in the minimum wage D) an increase in labor union membership
It is difficult for cyclically unemployed individuals to find jobs because:
a. they do not meet the qualifications required for the available jobs. b. the economy is in a recession. c. they quit their last job and employers view them with suspicion. d. they have not looked long enough to find a job.
Along a straight-line demand curve, why does the price elasticity of demand grow steadily smaller as we move from left to right?