The most appropriate countercyclical policy, or stabilization policy, in times of unemployment, according to classical economists, is for the government to
a. increase the minimum wage
b. impose wage and price controls
c. stimulate aggregate demand
d. cut taxes
e. do nothing
E
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Marla is an architect who is designing a home for Chuck. Chuck is paying Marla $150 per hour to design his new home. When Chuck and Marla get married, Marla continues to work on designing the home, but she no longer charges Chuck for her work
As a result, GDP ________ because ________. A) falls; Marla's architectural design services are no longer bought by Chuck once they're married B) falls; Marla's work becomes less valuable once she's married C) rises; Marla becomes more productive once she's married D) falls; Marla's work takes place in the underground economy once she's married
An analysis of the American economy since 1960 shows that there is a stable relationship between inflation and unemployment
A) only in the short run. B) only in the long run. C) in neither the short run nor the long run. D) in both the short run and the long run.
The figure below shows the payoff to two airlines, A and B, of serving a particular route. If the two airlines must decide simultaneously, which one of the following statements is TRUE?
A. The outcome of the game is unpredictable B. Neither firm entering is a Nash equilibrium C. Firm A does not have a dominant strategy D. Firm B does not have a dominant strategy
A good that entails relatively high fixed costs associated with the use of knowledge and other information-intensive inputs as key factors of production is
A) a logo good. B) a search good. C) a persuasive good. D) an information product.