In periods when GDP fails to grow at its normal rate, the actual unemployment rate will be ________ than the natural rate of unemployment.
A. lower
B. higher
C. the same
D. falling faster
Answer: B
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If the public has rational expectations, an attempt to increase aggregate demand to stimulate the economy will: a. be less inflationary in the short run than if the public alters their expectations slowly in response to changes in government policy. b. be more effective if the public alters their expectations quickly in response to changes in government policy. c. be ineffective if the shift
in aggregate demand is predictable. d. all of the above.
Suppose that Canada pegs its dollar to the U.S. dollar at a rate of $C1 = $US1 and that Canada is a major exporter of crude oil to the United States. The increase in the price of oil that occurred in the second half of 2007 is likely to:
A) cause asymmetric shocks to the U.S. and Canadian economies that will make it difficult for Canada to maintain the $C1 = $US1 exchange rate. B) cause symmetric shocks to the U.S. and Canadian economies that will make it difficult for Canada to maintain the $C1 = $US1 exchange rate. C) cause asymmetric shocks to the U.S. and Canadian economies and make it easier for Canada to maintain the $C1 = $US1 exchange rate. D) cause symmetric shocks to the U.S. and Canadian economies and make it difficult for Canada to maintain the $C1 = $US1 exchange rate.
Payroll tax puts a wedge between the wages firms pay and the wages workers earn due to ______.
a. which party the tax is levied against b. the inelasticity of supply relative to demand c. whether the supply or demand curve is shifted d. the fact that firms essentially pay the tax twice
Refer to the information given. If Indy holds his shares for five years, he:
Indy owns 100 shares of stock in Pet Mart Corporation that he purchased for $20 per share. Every year he has received, from company profits, $1 for each share he owns. A. will have received $500 in dividends. B. will earn a capital gain of $500. C. will receive $500 in interest. D. should sell the stock to maximize the return on his investment.