One of the ideas that found a permanent place in macroeconomics after Milton Friedman's presidential address to the American Economic Association in 1967 was that
A) there is not only a temporary tradeoff between inflation and unemployment, but a permanent tradeoff as well.
B) the tradeoff between unemployment and inflation exists only in the long run, but not in the short run.
C) people's expectations about economic events affect economic outcomes.
D) a and b
C
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Refer to the table below. The average benefit of 2 units of activity is:Units ofActivity TotalCostTotalBenefit0$0$01$30$1002$40$1603$60$1904$100$2105$150$2206$210$225
A. $60 B. $80 C. $20 D. $40
If purchasing-power parity holds, the price level in the U.S. is 250, and the price level in Japan is 260, which of the following is true?
a. the real exchange rate is 250/260 b. the real exchange rate is 260/250 c. the nominal exchange rate is 250/260 d. the nominal exchange rate is 260/250
What role did the Reconstruction Finance Corporation play in the banking collapse of the early 1930s?
a. It provided loans to troubled banks. b. It provided insurance for consumer deposits. c. Its new regulations forced undercapitalized banks out of business. d. Its failure sparked a widespread run on bank deposits.
Falling output, in the short run, could be due to:
A. an increase in short-run aggregate supply. B. a reduction in aggregate demand. C. an increase in long-run aggregate supply. D. an increase in aggregate demand.