The Fed's interest rate response to the rising output ratio experienced from 1997 to 1999 is explained by
A) beneficial supply shocks which pushed down the inflation rate.
B) the Fed's efforts to help end the Asian financial crisis
C) the Fed's uncertainty about the concepts of the natural level of output and natural rate of unemployment.
D) All of the above.
D
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Ethan enjoys buying books and going to the movies. He has income of $150 to spend on these two goods each month. The price of a book is $15 and the price of going to the movies is also $15. He currently consumes four books and six movies a month. If the price of a book increases to $20, then:
A. the substitution and income effects would both predict Ethan would consume more of both goods. B. the substitution and income effects would both predict Ethan would consume less of both goods. C. the substitution effect would predict Ethan would consume more books and less movies, and the income effect would predict he would consume less of both. D. the substitution effect would predict Ethan would consume less books and more movies and the income effect would predict he would consume less of both.
A benevolent social planner would prefer that the output of good x be decreased from its current level if, at the current level of output of good x,
a. social value = private value = private cost < social cost. b. private cost < social cost = private value = social value. c. social cost = private cost = private value < social value. d. social cost = private cost = private value = social value.
List the four major elements that determine productivity growth. Choose one of these factors and explain, using specific examples, the role that it has played in increasing productivity in the United States.
What will be an ideal response?
The average price of land used to grow food in Chicago is very high because
What will be an ideal response?