Today, the full-employment unemployment rate in the United States is generally agreed to be
a. 2 to 3 percent.
b. 3 to 4 percent.
c. 4 to 5 percent.
d. 5 to 6 percent.
d. 5 to 6 percent.
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Answer the following statement(s) true (T) or false (F)
1. The Pareto criterion is a criterion under which any proposal that can be unanimously defeated should be rejected. 2. To be effective, a price ceiling needs only to be enforced. 3. If a tax and a price control have the same effect on the price paid by consumers, then the two policies will create the same deadweight loss. 4. Consumers will benefit from a tariff, because it helps domestic firms and generates revenue for the government. 5. The value of a good is ultimately determined by the amount of labor needed to produce the good.
Full employment is not considered to be zero unemployment, because
A) some people do not want a job. B) people do not find jobs instantaneously. C) some cyclical unemployment always exists. D) there are not enough jobs for everyone who wants one.
Answer the following statement(s) true (T) or false (F)
1. Present-day fluctuations in exchange rates are determined solely by market forces. 2. When exchange rates change, they affect not only the currency market but the product markets as well. 3. Since the advent of flexible exchange rates, world trade has expanded. 4. The most important advantage of the Bretton Woods fixed-rate system is that it has reduced the speculative rampages that were common under a flexible-rate system. 5. Booming futures markets in foreign currencies opened in Chicago, New York, and in foreign financial centers during the years that the world used the Bretton Woods system.
An increase in the price level in the economies of U.S. trading partners will cause the aggregate expenditures function in the United States to
A. shift up. B. shift down. C. get flatter. D. get steeper.