The cost of stimulating the economy in the 1970s was:
A. high inflation and low unemployment for most of the 1980s.
B. a severe recession with high unemployment in the 1980s.
C. high inflation and high unemployment for most of the 1980s.
D. a mild recession with modest unemployment in the 1980s.
Ans: B. a severe recession with high unemployment in the 1980s.
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Generally speaking, the inclusion of transportation costs in the total costs of production has the effect of causing the LRAC curve to:
A) shift down. B) flatten out. C) shift up. D) become steeper over the range on economies of scale.
Suppose the production possibilities for two countries, producing either food or clothing, are shown in the above figure. The U.S. has a comparative advantage in producing
A) food. B) clothing. C) food and clothing. D) neither good.
A country is categorized as a low-income economy by the World Bank if its per capita income is below:
a. $1,000. b. $100. c. $10,000. d. $50. e. $5,000.
The price elasticity of demand for business travel tends to be greater than that of leisure travel.
Answer the following statement true (T) or false (F)