If prices in the New Keynesian model were perfectly flexible, then
A) there would be a role for monetary policy.
B) the output gap would be positive.
C) the equilibrium real interest rate would be the natural rate of interest.
D) the output gap would be negative.
C
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Adam Smith supported the view that ________ greatly influenced its economic growth
A) the culture in a nation B) the institutions in a nation C) the location of a nation D) the geography of a nation
Which of the following is a requirement for a perfectly competitive market?
A. Sellers maximize sales. B. There are barriers to entry. C. Buyers and sellers are price takers. D. There are indivisible setup costs.
A firm ________ in the short-run has an incentive to expand its long-run scale of operation.
A. earning positive profits B. that shuts down C. breaking even D. making a loss
Which of the following is a valid explanation for real wage growth?
A. The rising cost of capital accumulation B. A contraction of employment in manufacturing industries C. An increase in the quantity of labor D. A rising rate of labor productivity growth