The Friedman natural rate theory states that
A) in both the short run and the long run the economy stays at its natural rate of unemployment.
B) the economy will not return to its natural rate of unemployment in either the short run or the long run.
C) the economy stays at its natural rate of unemployment in the short run, but not in the long run.
D) in the long run the economy returns to its natural rate of unemployment.
D
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The Consumer Price Index market basket contains
A) the goods and services that the economists working for the BLS believes consumers should buy. B) the U.S.-produced goods and services purchased by an average urban household. C) the minimal dietary requirements of an average urban household. D) the goods and services purchased by an average urban household. E) the ideal calorie intake of each member of an average urban household.
The average total cost curves for Plant 1, ATC0, and Plant 2, ATC1, are shown in the figure above. Over what range of output is it efficient to operate Plant 1?
A) 0-20 B) 0-25 C) 20-25 D) greater than 25
Recurring upswings and downswings in an economy's real GDP over time are called:
A. recessions. B. business cycles. C. output yo-yos. D. total product oscillations.
"Competition is the great regulator." This statement reflects that
A) when competition is present, businesses have a strong incentive to serve the general public and therefore there is little need for regulation of competitive markets. B) government regulation is the key ingredient of competitive markets and therefore markets cannot be competitive without regulation. C) when markets are regulated by the government, there is no need for competition among business firms. D) extensive regulation is needed to assure that businesses will treat consumers properly and serve the interests of the general public.