John Maynard Keynes sought to solve the economic problem of the Great Depression, which was the coexistence of
A. high production and high inflation.
B. low production and low unemployment.
C. low production and high unemployment.
D. high production and low inflation.
Answer: C
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The ________ is the average hourly wage rate measured in current dollars, while the ________ is the average hourly rate measured in the dollars of a given reference base year
A) real interest rate; nominal interest rate B) nominal wage rate; real wage rate C) real wage rate; nominal wage rate D) nominal interest rate; real interest rate E) inflation rate; real wage rate
Economic depreciation is
A. the change in the distribution of real income induced by a tax. B. the extent to which an asset decreases in value during a period of time. C. the money value of the net increase in an individual's power to consume during a period. D. a subtraction from tax liability (as opposed to a subtraction from taxable income).
A contractionary fiscal policy shifts the aggregate demand curve
A) to the right and is used to close an inflationary gap. B) to the right and is used to close a recessionary gap. C) to the left and is used to close an inflationary gap. D) to the left and is used to close a recessionary gap.
The figure below shows the U.S. market for imported wine. For simplicity, we consider export supply curves to be flat. Chilean wine is available for $480 per barrel and French wine is available for $420 per barrel.
Suppose the United States has a tariff of $80 per barrel on imported wine. Then, the United States joins a free-trade area with Chile. Calculate the gain arising from trade creation after the United States joins the free-trade area.
A. $800 billion B. $550 million C. $250 million D. $50 million