Question 1

The short-run Phillips curve suggests what policy making implications?

Accepted Answer

A)  Active policy making does not yield any predictable results. 
B)  Passive policy making is more effective than active policy making. 
C)  Using discretionary policies, it may be possible to achieve just the right unemployment and inflation mix. 
D)  Maintaining both the inflation and unemployment rates at low levels is possible if policy makers will rely solely on nondiscretionary policy making. 
A)  Active policy making does not yield any predictable results. 
B)  Passive policy making is more effective than active policy making. 
C)  Using discretionary policies, it may be possible to achieve just the right unemployment and inflation mix. 
D)  Maintaining both the inflation and unemployment rates at low levels is possible if policy makers will rely solely on nondiscretionary policy making.

Question 2

One key implication of rational expectations is that

Accepted Answer

A)  anticipated monetary policy has no effect on the rate of unemployment or the level of real GDP. 
B)  anticipated monetary policy can affect the rate of unemployment but not the level of real GDP. 
C)  unanticipated monetary policy has no effect on the economy but anticipated monetary policy does have an effect on the economy. 
D)  both unanticipated monetary policy and anticipated monetary policy have an effect on the economy. 
A)  anticipated monetary policy has no effect on the rate of unemployment or the level of real GDP. 
B)  anticipated monetary policy can affect the rate of unemployment but not the level of real GDP. 
C)  unanticipated monetary policy has no effect on the economy but anticipated monetary policy does have an effect on the economy. 
D)  both unanticipated monetary policy and anticipated monetary policy have an effect on the economy.

Question 3

According to the real-business-cycle perspective,

Accepted Answer

A)  the economy cannot be stabilized by policy activism. 
B)  the Phillips curve is very important. 
C)  active policy making is important. 
D)  passive policy making is important. 
A)  the economy cannot be stabilized by policy activism. 
B)  the Phillips curve is very important. 
C)  active policy making is important. 
D)  passive policy making is important.

Question 4

When the economy is operating at a level of real GDP that is greater than its potential level, we know that

Accepted Answer

A)  the actual unemployment rate is greater than the natural rate of unemployment. 
B)  the structural rate of unemployment is negative. 
C)  the frictional unemployment is zero. 
D)  the cyclical rate of unemployment is negative. 
A)  the actual unemployment rate is greater than the natural rate of unemployment. 
B)  the structural rate of unemployment is negative. 
C)  the frictional unemployment is zero. 
D)  the cyclical rate of unemployment is negative.

Question 5

-Refer to the above figure. Suppose the economy is in equilibrium at point A. If rational expectations exist, an increase in aggregate demand caused by an anticipated increase in the money supply will cause the economy to

Accepted Answer

A)  stay at point A. 
B)  move to point B. 
C)  move to point C. 
D)  move to point D. 
A)  stay at point A. 
B)  move to point B. 
C)  move to point C. 
D)  move to point D.

Question 6

Unemployment that deviates from the natural rate of unemployment is referred to as

Accepted Answer

A)  frictional unemployment. 
B)  cyclical unemployment. 
C)  seasonal unemployment. 
D)  structural unemployment. 
A)  frictional unemployment. 
B)  cyclical unemployment. 
C)  seasonal unemployment. 
D)  structural unemployment.

The short-run Phillips curve suggests what policy making implications?

One key implication of rational expectations is that

According to the real-business-cycle perspective,

When the economy is operating at a level of real GDP that is greater than its potential level, we know that

-Refer to the above figure. Suppose the economy is in equilibrium at point A. If rational expectations exist, an increase in aggregate demand caused by an anticipated increase in the money supply will cause the economy to

Unemployment that deviates from the natural rate of unemployment is referred to as

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Measuring the Economys Performance

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money, Banking, and Central Banking

Domestic and International Dimensions of Monetary Policy

Policies and Prospects for Global Economic Growth

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, Poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters

Exam 17: Stabilization in an Integrated World Economy

The short-run Phillips curve suggests what policy making implications?

One key implication of rational expectations is that

According to the real-business-cycle perspective,

When the economy is operating at a level of real GDP that is greater than its potential level, we know that

-Refer to the above figure. Suppose the economy is in equilibrium at point A. If rational expectations exist, an increase in aggregate demand caused by an anticipated increase in the money supply will cause the economy to

Unemployment that deviates from the natural rate of unemployment is referred to as

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

The Macroeconomy: Unemployment, Inflation, and Deflation

Measuring the Economys Performance

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money, Banking, and Central Banking

Domestic and International Dimensions of Monetary Policy

Policies and Prospects for Global Economic Growth

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, Poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters