Exam 12: U.S Inflation, Unemployment, and Business Cycle

The factor leading to business cycles in the real business cycle theory is changes in the growth rate of

ʺInflation Gives Saudis Food for Thoughtʺ ʺMy boss sent me back to return the milk - itʹs too expensive,ʺ said the Pakistani driver for a middle-class Saudi family at the checkout counter of the Al-Othaim supermarket. Saudi Arabia Is enjoying an unprecedented economic boom as sectors [have] increased activity to meet the big Internal demand. The story describes

If an economy at potential GDP experiences a demand shock that shifts the aggregate demand curve rightward, there will be

Which of the following is NOT one of the criticisms of real business cycle theory?

The anticipated inflation rate is 5 percent. In order for purchasing power to remain constant, the money wage rate must rise by

The short-run Phillips curve

-In the above figure, suppose the economy has moved from point D to point B. According to the monetarist theory of the business cycle, what could have caused this movement?

Based on the Keynesian theory of the business cycle, if the economy is at its full -employment equilibrium and aggregate demand increases then

In a speech to Asia Pacific Economic Cooperation summit in Peru in November 2008, President Hu of China commented on his countryʹs $586 billion fiscal stimulus plan by saying, ʺInstead of relying mainly on investment and export we will adopt a coordinated approach that combines consumption, investment and export to boost the economy. And instead of relying heavily on higher consumption of material resources we will achieve development by making scientific and technological progress.ʺ If his countryʹs plan works and the expected inflation rate does not change, there will be a

The initial factors that can create a cost-push inflation do NOT include

The Keynesian explanation of the business cycle rests on several concepts, including

For a persistent cost-push inflation to occur, the Fed must persistently increase the quantity of money.

An increase in the money wage rate shifts the SAS curve___________ and an increase in the money prices of raw materials shifts the SAS curve___________ .

Moving along a short-run Phillips curve,

Which theory distinguishes between expected and unexpected fluctuations in aggregate demand and asserts that only unexpected changes can affect real GDP?

For a cost-push inflation to occur, oil price increases must be accompanied by

The real business cycle theory asserts that changes in __________lead to changes in__________ .

Which of the following statements about the long -run Phillips curve is correct?

Stagflation occurs when the

Which of the following describes the Keynesian approach to the business cycle? I. Unanticipated shocks to aggregate supply drive expansions and recessions. II. The Keynesian theory is a real business cycle model of the economy. III. A decrease in business confidence can trigger a recession.