In the wage-setting relation, the nominal wage tends to decrease when
A) the price level increases.
B) the unemployment rate decreases.
C) unemployment benefits decrease.
D) the minimum wage increases.
E) all of the above
C
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Which of the following is NOT a source of bias in the CPI? i. quality change bias ii. new goods bias iii. quantity change bias
A) i only B) ii only C) iii only D) i and ii E) ii and iii
The average total cost curves for plants A, B, C, and D are shown in the above figure. The plant size that is the most economically efficient
A) is plant A. B) is plant B. C) is plant C. D) depends on the desired level of output.
In the basic closed-economy ISLM model, the goods market can be described by the
A) consumption function. B) investment function. C) government spending and tax. D) goods market equilibrium condition. E) all of the above.
Policy is conducted via a rule if policymakers
a. use monetary and fiscal policy only when the political situation dictates it. b. set monetary and fiscal policy according to multiple but predetermined goals. c. a free to respond to unexpected changes in economic conditions. d. announce in advance how they will respond to changes in economic conditions.