According to Okun's law, when the output gap is negative, cyclical unemployment:
A. is negative.
B. equals structural unemployment.
C. is positive.
D. equals frictional unemployment.
Answer: C
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Elasticity rises as price falls along a linear, downward-sloping demand curve
a. True b. False
Suppose that the equilibrium price of T-shirts increases and the equilibrium quantity of T-shirts decreases. This is best explained by:
A. an increase in the demand for T-shirts. B. a decrease in the supply of T-shirts. C. a decrease in the demand for T-shirts. D. an increase in the supply of T-shirts.
In the 1980s, Howard was one of the best car phone repairmen in his area. After staying home in the 1990s and early 2000s to take care of his children, Howard wants to go back to work in the phone repair business. Which of the following can be said about Howard?
A. Howard's ability to repair car phones represents an obsolete skill. B. Because car phones are obsolete, Howard's human capital is less valuable. C. Howard's knowledge of how to repair car phones is obsolete, and his human capital is less valuable now than in 1980. D. All of these could be said about Howard.
What does the dotted line between C and D represent?
a. excess production
b. excess consumption
c. aggregate expenditure
d. aggregate production