"Demand" refers to the relationship between the price of a good and the quantity consumers are willing and able to buy at each price
Indicate whether the statement is true or false
TRUE
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Which of the following is not a problem for the price system allocating resources among different time periods?
a. Interest rates are used for a variety of purposes other than influencing investment. b. The market devotes too much to immediate consumption. c. Our market system leads to lesser real incomes for later generations. d. Our market system despoils irreplaceable natural resources.
Frictional unemployment is a part of the unemployment rate that refers to those workers who are: a. moving between jobs
b. no longer looking for a job because they are discouraged about their prospects. c. jobless due to the seasonal nature of their jobs. d. jobless due to a recession in the economy.
If potential output for an economy equals $8 billion, and actual output equals $7 billion, then this economy has a(n):
A. recessionary gap. B. budget deficit. C. expansionary gap. D. trade deficit.
Monetary policy is most effective in influencing aggregate demand
A. under a fixed exchange-rate system without sterilization. B. when there is low capital mobility. C. under a freely floating exchange-rate system. D. under a fixed exchange-rate system with sterilization.