Which of the following statements is true of unemployment?
a. Cyclical unemployment decreases during recessions and increases during expansions
b. Some unemployment exists even when the economy is healthy and growing.
c. Unemployment and inflation are not related.
d. People who are willing and able to work but have given up the search for a job are considered unemployed.
e. Voluntary unemployment refers to a situation in which people who really do not want to work only pretend to look for jobs.
b
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If the two music stores are faced with the game in the figure, we can see that:
This figure displays the choices and payoffs (company profits) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the area deciding whether to charge its usual high prices or to charge very low prices, in the hopes that a new business will not be able to make a profit at such low prices. The Rock Shop is trying to decide whether or not it should enter the market and compete with MiiTunes.
A. The Rock Shop has a dominant strategy, but MiiTunes does not.
B. MiiTunes has a dominant strategy, but The Rock Shop does not.
C. neither store has a dominant strategy.
D. both stores have a dominant strategy.
Consider Larry's decision to go to college. If he goes to college, he will spend a total of $120,000 on tuition, $30,000 on room and board, and $3,500 on books over four years. If he does not go to college, he will earn $30,000 annually working in a store and spend $7,000 on room and board each year. Larry's cost of going to college is
a. $123,500. b. $153,500. c. $190,500 d. $245,500
Suppose that indifference curve I1 lies to the right of indifference curve I2. We can conclude that
A) some, but not all, points on indifference curve I1 will correspond to higher utility than points along indifference curve I2. B) some, but not all, points on indifference curve I1 will correspond to lower utility than points along indifference curve I2. C) all points along indifference curve I1 will correspond to higher utility than points along indifference curve I2. D) all points along indifference curve I1 will correspond to lower utility than points along indifference curve I2.
Many economists would argue that some frictional unemployment
A. creates massive economic disruptions and should be eliminated as quickly as feasible. B. cannot and probably should not be eliminated. C. no longer exists because increased unemployment benefits have generally solved this problem. D. should be eliminated whatever the cost.