If the economy is represented in the graph shown and is currently at point E1, what could be said about the state of the economy?
A. There is higher unemployment than the natural rate.
B. There is lower unemployment than the natural rate.
C. The unemployment rate is just about the natural rate.
D. The unemployment rate is zero.
C. The unemployment rate is just about the natural rate.
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Money spent on the purchase of a newly constructed house is included in GDP as a part of ________.
A. household expenditures on durable goods B. personal saving C. gross domestic private investment D. personal consumption expenditures
How do lags affect stabilization policy? Your answer should include three specific types of lags.
What will be an ideal response?
If the national debt is owed entirely to U.S. citizens,
A. paying off the debt will necessarily stimulate growth. B. future interest payments on the debt are not a burden to the nation as a whole. C. future economic growth will necessarily be slowed. D. the debt constitutes a burden to these citizens.
Comparative advantage has mixed results when it comes to predicting a country's trade patterns. Which of the following is FALSE?
A) There are many potential products an economy might export that use the same comparative advantage. B) A large share of international trade is not based on comparative advantage. C) Comparative advantage has proven completely incapable of predicting trade. D) Comparative advantage is a dynamic concept, which means that the spread of technology, improvement in skills, and learning-by-doing may alter a country's comparative advantage over time.