A phase in the business cycle in which the economy's real GDP declines is known as:
a. a depression.
b. a recession.
c. a downtick.
d. disequilibrium.
e. limited demand.
b
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Refer to Table 2-4. Which of the following statements is true?
A) George has an absolute advantage in both tasks. B) Jack has an absolute advantage in both tasks. C) Jack has an absolute advantage in lawn mowing and George in garden cultivating. D) Jack has an absolute advantage in garden cultivating and George in lawn mowing.
In the rational expectations model, government control over aggregate demand
a. can affect real output only if policies are unexpected. b. has potential to change real output as long as aggregate supply is vertical. c. gives it the ability to change real output and employment. d. does not influence the economic behavior of individuals.
Positive analysis:
A. aims at determining only the economic consequences of a particular policy. B. recommends whether a policy should be implemented. C. determines whether the consequences of a policy are desirable. D. depends on the analyst's values.
Which of the following examples of product differentiation uses prestige?
a. A cheese company advertises that it uses only milk from grass-fed cows. b. An automobile company advertises that it recently won Best Car of the Year. c. A chain coffee store advertises its many locations. d. A fast-food restaurant advertises service under five minutes per customer.