Which of the following has occurred when government directives do not produce better economic outcomes?
A. Government failure.
B. Macroeconomic failure.
C. Scarcity.
D. Market failure.
Answer: A
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A high unemployment rate most likely means that there is a:
a. Large GDP gap in the economy b. High rate of inflation in the economy c. Low rate of interest in the economy d. Small GDP gap in the economy
When the government imposes a tax on labor income, __________ the production function occurs and potential GDP _________.
Fill in the blank(s) with the appropriate word(s).
Explain how discouraged workers either overstate or understate the unemployment problem.
What will be an ideal response?
When Keynesians argue that "correlation does not necessarily imply causation," they are probably criticizing
A) structural-model evidence. B) reduced-form evidence. C) indirect-model evidence. D) black-box evidence.