A productivity growth slowdown can be shown as year-to-year fluctuations of real GDP around potential GDP
Indicate whether the statement is true or false
FALSE
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The vertical intercept of the consumption function equals ________ and the slope equals ________.
A. autonomous consumption; the MPC. B. the planned component of consumption; the unplanned component of consumption. C. the unplanned component of consumption; the planned component of consumption. D. the MPC; autonomous consumption.
Goods are ________ when the income elasticity of demand is less than zero
A) substitutes B) complements C) inferior D) elastic E) normal
Which of the following is TRUE?
A) Points along the aggregate supply curve show the equilibrium levels of output and prices that are consistent on the demand side of the economy. B) Points along the aggregate demand curve show the equilibrium levels of output and prices that are consistent on the supply side of the economy. C) Aggregate demand shows the levels of GDP and prices where expenditure decisions and production decisions match. D) Aggregate supply shows the levels of GDP and prices where expenditure decisions and production decisions match.
Which of the following statements is correct?
a. A disadvantage of a minimum-wage law is that it may benefit unskilled workers who are not low-income workers. b. A disadvantage of a negative income tax program is that a poor person who chooses not to work many hours would receive a cash benefit. c. A disadvantage of an Earned Income Tax Credit (EITC) is that a person who is unable to work due to a disability does not benefit from the program. d. All of the above are correct.