The cyclical unemployment rate is positive when
A. frictional unemployment equals structural unemployment.
B. there is an expansionary gap.
C. the output gap equals zero.
D. there is a recessionary gap.
Answer: D
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During the recession phase of the business cycle,
A. Interest rates are usually falling B. Income is usually rising C. Production is usually rising D. Unemployment is usually falling.
Empirical evidence suggests that the relative scarcity of most resources is
a. declining. b. increasing slowly. c. increasing rapidly. d. largely unchanged over the past four decades.
An advantage that money has over other assets is that it:
A. is a safer asset to hold during times of inflation. B. provides a higher return to the owner. C. increases in value over time. D. has lower transaction costs to use as a means of payment than other assets.
A demand curve for a normal good
A. is constructed based on the assumption that income is rising. B. shows the inverse relationship between price and quantity demanded. C. slopes upward and to the right. D. is constructed based on the assumption that an inverse relationship exists between price and income.