One plausible explanation for the large amount of U.S. currency outstanding is that many dollars are held abroad
a. True
b. False
Indicate whether the statement is true or false
True
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What is the main difference between a temporary and permanently negative supply shock?
A) The real interest rate immediately decreases after a temporary shock while it eventually increases after a permanent shock. B) Output increases right away after a temporary shock but the impact does not last whereas for a permanent shock output permanently decreases. C) A temporary shock will see a permanent increase in inflation while inflation will only rise temporarily after a permanent shock. D) all of the above E) none of the above
Suppose researchers discover that a government program to match job seekers and employers has caused an increase in the unemployment rate. Does this mean that the program has failed?
What will be an ideal response?
If a firm finds itself operating in Stage I, it implies that
A) variable inputs are extremely expensive. B) it overinvested in fixed capacity. C) it underinvested in fixed capacity. D) fixed inputs are extremely expensive.
What factor would not help resolve the Bertrand paradox (that a perfectly competitive outcome can emerge with as few as two firms in the market) if the basic Bertrand model were extended to include it?
a. Repeated interaction b. Search costs c. Sequential moves d. Product differentiation