If aggregate supply keeps decreasing while aggregate demand does not change, there will come at time when
a. demand-dull inflation will occur
b. cost-push inflation will occur
c. demand-push inflation will occur
d. cost-pull inflation will occur
e. the economy will reach full employment
B
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A positive spending shock ________ real interest rates and ________ output in the short run, thereby its effect on stock prices is ________
A) raises; lowers; positive B) raises; raises; ambiguous C) lowers; raises; negative D) lowers; raises; positive
The real wage rate is defined as the wage rate divided by
a. the interest rate. b. the money supply. c. nominal GDP. d. the price level.
Government economic policies are designed to have the biggest impact on _____
a. cyclical unemployment b. frictional unemployment c. structural unemployment d. seasonal unemployment
Tsintah weaves traditional Navaho rugs. She weaves and sells 50 rugs. Her average cost of production per rug is $50 . She sells each rug for a price of $65 . Tsintah's total revenues are
a. $750. b. $2,500. c. $3,250. d. $5,750.