Suppose the current unemployment rate is 15 percent. If it rises to 20 percent
A) the economy will move up along the production possibilities curve.
B) the economy will move closer to the production possibilities curve.
C) the production possibilities curve will shift inward.
D) the economy will operate farther inside the production possibilities curve.
D
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The game of Matching Pennies
a. has no Nash equilibrium. b. has a pure-strategy Nash equilibrium. c. has a mixed strategy Nash equilibrium. d. has multiple Nash equilibria.
The present discounted value of $100 to be received in one year and with an interest rate of 10 percent is closest to
a. $100 b. $10 c. $110 d. $91 e. $80
Suppose the nominal interest rate is 4 percent annually, and you deposit $1,000. Inflation in the economy throughout the year is 5 percent. At the end of the year, you have earned:
A. a nominal increase in your savings of $40. B. an increase in your purchasing power. C. a real rate of return of 1 percent. D. All of these statements are true.
What does elasticity of demand measure?
(A) The amount of time consumers need to change their demand for a good. (B) A decrease in the quantity demanded. (C) An increase in the quantity available. (D) How buyers will cut back or increase their demand when price rises or falls.