For the firm in the real intertemporal model with investment A) depreciation occurs more quickly if the firm produces more output. B) depreciation takes place at a constant rate. C) depreciation can be slowed with more maintenance. D) depreciation is always 100%. ANSWER B
Date: September 10th, 2020
If the nominal GDP is $12,000 in 2005 and $15,000 in 2006, and if inflation is 10% between these years, then a. employment fell between 2005 and 2006. b. real GDP fell between 2005 and 2006. c. real GDP rose between 2005 and 2006. d. the economy experienced no growth between these years. e. everyone […]
Date: September 10th, 2020
The LM curve slopes upward because a. as income rises, savings rise, increasing output. b. as interest rates rise, the money supply rises, increasing output. c. as interest rates rise, planned investment must fall, increasing output. d. as income increases, money demand rises, which increases interest rates. e. none of the above. ANSWER D
Date: September 10th, 2020
The short-run aggregate supply curve shows that inflation will change as a result of changes in ________. A) output B) potential output C) expected inflation D) price shocks E) all of the above ANSWER E
Date: September 10th, 2020
The supply of labor in the classical system is a function of the a. marginal product of labor. b. real wage. c. the public’s preference for leisure. d. money wage. e. b and c ANSWER E
Date: September 10th, 2020
The real interest rate ________ inflation ________. A) is unaffected in the long run by; because of the classical dichotomy B) moves one for one with expected; in the long run C) always increases with; but because of the Fisher effect lower expected inflation ensues D) all of the above E) none of the above […]
Date: September 10th, 2020
In the United States, the Phillips curve is not stable in that A) the intercept of the Phillips curve changes over time, but the slope does not change. B) the intercept and slope of the observed Phillips curve change over time. C) the slope of the Phillips curve changes, but its intercept does not change. […]
Date: September 10th, 2020
New classical macroeconomists believe that a. markets clear each and every period. b. the labor market does not clear. c. individuals are locked into money wage constraints. d. individuals face market constraints in their ability to act in their own self-interest. e. none of the above. ANSWER E
Date: September 10th, 2020
The root cause of the hyperinflation that plagued Zimbabwe in the 2000s is ________. A) printing of too much money by the central bank B) government expenditures greatly above revenues C) outlawing of price increases on many commodities D) allowing the use of foreign currencies E) the issuance of a $100 billion bank note […]
Date: September 10th, 2020
Which of the following does not impact aggregate demand in the Keynesian model? a. Changes in the supply of labor b. Net exports c. Household consumption d. Desired business investment demand e. Government purchases of goods and services ANSWER A
Date: September 10th, 2020
