Suppose an economy experiences a reduction in productivity. Explain both the short-run and medium-run effects of this reduction in productivity on output, employment, and the unemployment rate
What will be an ideal response?
In both the short run and medium run, TP will cause a reduction in output (assuming, of course, that any change in AD, if it occurs, is offset by the shift in the AS curve). What happens to employment in the medium? Given that Y will fall by the full change in TP in the medium, we know that N and u will not be affected in the medium run. In the short run, N will fall and u will rise if the percentage change in Y is less than the percentage change in TP.
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If the price level rose in three consecutive years from 100 to 120 to 140, then the annual inflation rate over those years would
A) decrease. B) remain the same. C) equal 20%. D) increase.
Comment on the following statement: "For a monopolist, marginal revenue is always equal to price."
What will be an ideal response?
The only way the standard of living of the average person in a country can increase is if ________ increases faster than ________
A) population; production B) population; income C) population; GDP per capita D) production; population
The following table shows the export and import values of automobiles, pharmaceuticals, and clothing in Country A and Country B. Country AExports ($Billions)Imports ($Billions)Automobiles2040Pharmaceuticals3030Clothing400Country BExports ($Billions)Imports ($Billions)Automobiles020Pharmaceuticals4040Clothing4535 In Country A, the product with the highest intra-industry trade (IIT) share is ________ and the product with the lowest IIT share is
A. clothing; automobiles. B. automobiles; pharmaceuticals. C. pharmaceuticals; clothing. D. clothing; pharmaceuticals.