Starting from long-run equilibrium, an adverse inflation shock results in a short-run equilibrium with ________ inflation and ________ output.
A. lower; lower
B. higher; lower
C. higher; higher
D. higher; potential
Answer: B
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The Business Cycle Dating Committee, a part of the ________, officially decides when a recession begins and ends
A) National Bureau of Economic Research B) federal government C) Bureau of Labor Statistics D) Federal Reserve
Nominal interest rates tend to be higher in countries with
A) higher rates of inflation. B) lower rates of inflation. C) lower real interest rates. D) Both B and C.
In a Cournot equilibrium, each firm chooses an output level which:
a. maximizes joint profits. b. maximizes the price received. c. maximizes profits given what the other firms produce. d. maximizes revenue given what the other firms produce.
Which phrase finishes this statement best? The net effect of a union increasing wages
A. is to lower non-union wages by an offsetting amount so national income is not changed. B. is that no one gains in the end since union shops cannot compete and do not survive. C. is to misallocate labor toward non-union work unless unionization enhances union worker productivity by its actions. D. is to increase wages in both union and non-union sectors.