Suppose that everyone who has looked for a job for more than six months gave up in despair and stopped looking. What would happen to the unemployment rate?
a. It would increase
b. It would fall.
c. It would change, but the effect cannot be predicted.
d. It would not change.
b
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Macroeconomists are concerned with each of the following issues EXCEPT:
A. Why does inflation vary across countries? B. Why does inflation vary over time? C. Why do the prices of computers increase more slowly than the price of gasoline? D. What are the costs of inflation?
Answer the following statement(s) true (T) or false (F)
1. A Pigou tax forces car manufacturers to internalize the cost of pollution. 2. Cap and Trade is so named because the government puts a “cap” on the amount of exports that domestic firms are allowed to “trade” with foreign nations. 3. A Cap and Trade system is more prone to error than a Pigou tax. 4. Pigou taxes are unnecessary in the presence of transaction costs. 5. Pigovian analysis indicates that a subsidy should be awarded when economic activity creates social benefits.
Rhonda sells a house she has owned for 15 years and starts living in a rented apartment. To make it more marketable, she buys carpeting that she has professionally installed and buys wallpaper that her daughter hangs. Which items would be included in this year's gross domestic product (GDP)?
a. The sale price of the house b. The cost of transporting all her furnitures to the new apartment c. The opportunity cost of Rhonda's daughter's time d. The opportunity cost of Rhonda's time e. The purchase price for carpet and wallpaper, and the installation fee for the carpet
Which of the following can shift the demand curve for labor to the right?
a. decrease in the price of the good b. increase in the wage rate c. decrease in the wage rate d. decrease in the marginal physical product e. increase in labor productivity