Which of the following is a positive economic statement?
a. reducing unemployment should be the highest priority of the federal government.
b. a reduction in the payroll tax will reduce the unemployment rate.
c. corporations should be prohibited from laying off workers during a recession.
d. the current unemployment rate is too high.
B
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Referring to Figure 19.2, the effect of a decrease in Japanese prices is represented by a movement from point
A) d to a. B) d to c. C) c to d. D) c to b.
Compared to the closed economy Keynesian model, the open economy model in which imports are a function of income has an investment multiplier that is
a. smaller. b. larger. c. equal. d. equal to 1.
A low price-earnings ratio indicates that either the stock is
a. undervalued or people are relatively optimistic about the corporation's prospects. b. overvalued or people are relatively optimistic about the corporation's prospects. c. overvalued or people are relatively pessimistic about the corporation's prospects. d. undervalued or people are relatively pessimistic about the corporation's prospects.
(Last Word) Passively managed funds produce higher rates of return for investors than actively managed funds because:
A. trading and management costs are higher with actively managed funds. B. passively managed funds invest in riskier assets that have higher rates of return. C. actively managed funds invest in riskier assets that have not reached expected rates of return. D. actively managed funds are taxed, while passively managed funds are not taxable.