A recessionary gap develops _____
Fill in the blank(s) with the appropriate word(s).
only when unemployment exceeds its natural rate.
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Initially, demand-pull inflation will
A) increase both the price level and increase real GDP. B) shift the aggregate supply curve rightward. C) decrease potential GDP. D) increase the price level and decrease real GDP. E) increase the price level and not change real GDP.
As the circular flow model points out, a choice that households make is how
A) many resources a firm will hire. B) many goods and services are produced. C) many goods and services are purchased. D) much labor is hired. E) much the government will collect in taxes and how much the government will spend on transfer payments.
Compared with the 19th century, during the colonial period technological changes that raised output relative to inputs:
a. were slow and steady. b. increased in the early part of the period, but fell off dramatically after 1643. c. remained minor and sporadic. d. increased dramatically after 1643.
If the price of one good increases, and as a result the demand for another related good falls, the goods are
A. complements. B. normal goods. C. substitutes. D. inferior goods.