If policy makers think the natural rate of unemployment is lower than it really is, then their policies designed to move the economy to the estimated natural rate, if continued over the long run, will:
a. cause continuing inflation
b. shift the long-run aggregate supply curve to the right.
c. shift the supply curve of labor to the right.
d. lead to a lower price level.
e. keep the economy below its potential GDP level.
a
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According to the new classical theory, if the public correctly anticipates a government policy to increase aggregate demand, then
A) there will be a short-run tradeoff between inflation and unemployment, but there will not be a long-run tradeoff. B) there will be a long-run tradeoff between inflation and unemployment, but there will not be a short-run tradeoff. C) there will be both a long-run and a short-run tradeoff between inflation and unemployment. D) there will be neither a long-run nor a short-run tradeoff between inflation and unemployment. E) there may be a short-run tradeoff between inflation and unemployment, but one cannot say for certain whether there will be a long-run tradeoff.
(Last Word) Which of the following best illustrates the post hoc, ergo propter hoc fallacy?
A. Because it was 90 degrees today, I worked up a sweat playing tennis. B. I took the day off work to go to the beach and that's why it rained. C. Because it rained at the football game, my new sweater got wet. D. Because I have studied diligently this semester, my grade average has improved.
The above figure shows the market for rice in Japan. S2 represents the domestic supply curve, and S1 represents the world supply curve. Currently 10 units are imported. The loss from shifting production from foreign to domestic producers equals
A) c + e. B) i. C) e. D) a + c + d + e.
In the last 40 years, merger policy has become a major way for antitrust authorities to regulate market structure
Indicate whether the statement is true or false