Exam 12: Inflation, Jobs, and the Business Cycle

According to the new Keynesian cycle theory of the business cycle,which of the following can trigger a business cycle expansion? I. an unexpected increase in the quantity of money II. an expected increase in the quantity of money III. an expected increase in government expenditure

-Which of the diagrams in the above figure best illustrates a short-run Phillips curve?

Which of the following pieces of evidence is most consistent with the monetarist theory?

What,according to the monetarist theory of the business cycle,leads to changes in real GDP?

Monetarists believe in changes in animal spirits are the factor that leads to business cycles.

Moving along the short-run Phillips curve indicates

The real business cycle (RBC) theory assets that the impact on real GDP of technological change is

For a persistent demand-pull inflation to occur,government expenditure must persistently increase.

The key ripple effect in real business cycle theory is the ________ decision and it depends on the ________.

Stagflation is the result of

What are sources that can start a demand-pull inflation?

-In the above figure,which path represents a demand-pull inflation?

"Intertemporal substitution" in labor supply describes changes in labor supply in response to changes in

The ________ cycle theory states that only unexpected fluctuations in aggregate demand are the main source of business cycles.

If the real interest rate is 2 percent and workers expect real wages to be 4 percent higher next year,according to real business cycle theory,workers will work

The monetarist theory of the business cycle regards ________ as the factor that leads to business cycles.

The main sources of cost-push inflation are increases in

-In the above figure,suppose the economy is at point A.An unexpected increase in the inflation rate to 6 percent will result in a movement to point

According to the real business cycle theory,a decrease in the real interest rate today increases current labor supply.

-In the above figure,the economy is initially at point A.If workers and firms correctly anticipate the increase in aggregate demand and the resulting inflation rate,the economy will move to point