For this question, assume that the Phillips curve equation is represented by the following: ?t - ?t-1 = (m + z) - ?ut. Which of the following will cause a reduction in the natural rate of unemployment?
A) an increase in m
B) an increase in z
C) an increase in ?
D) an increase in actual inflation
E) an increase in expected inflation
C
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To use an analogy that helps explain the ABCs of economic development: To build a skyscraper, you must first build the foundation. In order for an economy to create economic development, it must first develop a solid
a. network of resources b. production possibilities curve c. infrastructure d. dualist structure e. base for foreign investment and aid
According to the Laffer curve, when the tax rate is 100 percent, tax revenue will be:
A. 0. B. at the maximum value. C. the same as it would be at a 50 percent tax rate. D. greater than it would be at a 50 percent tax rate.
In an all-currency economy in which real output and the real interest rate are fixed and the rates of money growth and inflation are constant, the inflation rate equals
A. the real interest rate. B. the nominal interest rate. C. the level of real seignorage revenue. D. the growth rate of the nominal money supply.
A sunk cost has no effect on supply because it
A) applies to all suppliers. B) can be passed on to consumers. C) cannot be avoided by not supplying. D) cannot be passed on to consumers. E) did not have to be incurred in order for the good to be supplied.