macro-10错题

According to real business cycle​ theory, unemployment is​ structural, caused by technological shocks that decrease aggregate supply.

A

A change in the money wage rate does not change​ long-run aggregate supply because​ _______.

A. a change in the money wage rate changes​ firms' costs in the short run but not in the long run B. potential GDP is constant C. a change in the money wage rate has no effect on the real wage​ rate, everything else remaining the same D. on the LAS​ curve, the change in the money wage rate is accompanied by an equal percentage change in the price level

The events which could have changed​ short-run aggregate supply from SAS Subscript 0 to SAS Subscript 1 are​ ______.

A. a decrease in expected future profits or an increase in expected inflation B. a rise in the interest rate or a decrease in the quantity of money C. an increase in taxes or a decrease in government expenditures D. a rise in the money wage rate or a rise in the money price of any other factor of production

A rise in the money wage rate with no change in potential GDP creates​ ______.

A. a movement along the SAS curve B. a leftward shift of the LAS curve and a leftward shift of the SAS curve C. a leftward shift of the LAS curve and no change in the SAS curve D. a leftward shift of the SAS curve and no change in the LAS curve

if the price level and the money wage rate rise by the same​ percentage, what happens to the quantity of real GDP​ supplied? Along which aggregate supply curve does the economy​ move? f the price level and the money wage rate rise by the same​ percentage, the quantity of real GDP supplied​ _______ and there is a movement up along the​ _______ aggregate supply curve.

A. does not​ change; short-run B. ​decreases; long-run C. ​increases; short-run D. does not​ change; long-run

A rise in the wage rate​ _______.

A. has no effect on aggregate supply or the quantity of real GDP supplied B. decreases​ short-run aggregate supply and does not change​ long-run aggregate supply Your answer is correct. C. increases the price​ level, which increases the quantity of real GDP supplied D. decreases​ short-run aggregate supply and​ long-run aggregate supply

Starting from a​ full-employment equilibrium, a decrease in​ short-run aggregate supply​ ______ the price level and​ ______ potential GDP.

A. ​decreases; increases real GDP above B. ​increases; decreases real GDP below Your answer is correct. C. ​increases; increases real GDP above D. ​decreases; decreases real GDP below

In the long​ run, the money wage rate​ ______, short-run aggregate supply​ ______, and the economy returns to a​ full-employment equilibrium.

A. ​falls; decreases B. ​falls; increases C. ​rises; decreases Your answer is correct. D. ​rises; increases

The 2.2 percent​ year-over-year growth in the average weekly wage rate​ _______ short-run aggregate supply and​ _______ long-run aggregate supply.

A. ​increases; increases B. ​decreases; does not change Your answer is correct. C. does not​ change; does not change D. ​decreases; decreases

The ​short-run Phillips curve is a curve that shows the relationship between the​ _____ rate and​ _____ when​ _____ and the​ _____ remain constant. Part 2 The ​long-run Phillips curve is the relationship between​ _____ and​ _____ when the economy is at full employment. The​ long-run Phillips curve is a​ _____ line at the​ _____ unemployment rate.

A. ​unemployment; real​ GDP; real​ GDP; cyclical unemployment rate B. ​interest; real​ GDP; potential​ GDP; expected inflation rate C. ​inflation; the interest​ rate; the interest​ rate; supply of loanable funds D. ​inflation; the unemployment​ rate; the natural unemployment​ rate; expected inflation rate Your answer is correct. A. ​inflation; nominal​ GDP; horizontal; frictional B. real​ GDP; potential​ GDP; vertical; cyclical C. ​inflation; unemployment;​ vertical; natural Your answer is correct. D. real​ GDP; the real interest​ rate; horizontal; natural

A

In Keynesian cycle​ theory, fluctuations in investment driven by fluctuations in business confidence are the main source of fluctuations in aggregate demand. In monetarist cycle​ theory, fluctuations in both investment and consumption​ expenditure, driven by fluctuations in the growth rate of the quantity of​ money, are the main source of fluctuations in aggregate demand. Both the Keynesian and monetarist theories assume that the money wage rate is rigid and​ don't explain that rigidity. OK

The unemployment rate during the Great Depression peaked at nearly 25 percent in​ 1933, after an initial spike from 3 percent in 1929 to nearly 8.7 percent in 1930. The unemployment rate is just 5​ percent, only up from 4.5 percent a year ago. Also during the Great Depression there was​ deflation, which is not happening today. The inflation and unemployment trends during the Great Depression can be explained by a movement along the​ ______ Phillips curve that​ ______.

The​ short-run Phillips curve shows the relationship between inflation and​ unemployment, holding constant the expected inflation rate and the natural unemployment rate. During the Great​ Depression, the economy experienced high unemployment and deflation. Along the​ short-run Phillips curve there is a tradeoff between inflation and unemployment. As the inflation rate​ falls, the unemployment rate rises. So the Great Depression can be explained as a movement along the​ short-run Phillips curve. A. ​short-run; lowers the inflation rate and increases the unemployment rate Your answer is correct. B. ​long-run; increases the unemployment rate and leaves the expected inflation rate unchanged C. ​short-run; lowers the expected inflation rate and increases the actual unemployment rate D. ​long-run; lowers the inflation rate and increases the unemployment rat

The government of Shell Island announces an increase in spending of​ $50 billion a year and the central bank will increase the quantity of money to pay for the spending. Does the economy go into a​ boom? Will there be​ inflation? The economy​ _____ into a​ boom, real GDP​ _____ billion, and​ _____ arises.

When the government announces an increase in spending of​ $50 billion a​ year, aggregate demand increases and the increase in aggregate demand is anticipated. Because the central bank increases the quantity of​ money, businesses anticipate the rise in the price​ level, so the money wage rises. Aggregate supply decreases. Real GDP remains at​ $600 billion and no output gap is​ created, but an anticipated inflation occurs. Key​ Point: An anticipated increase in aggregate demand accompanied by an increase in the quantity of money creates an anticipated inflation spiral with the economy at full employment. A. does not​ go; decreases to​ $600; deflation B. ​goes; remains at​ $600; inflation C. does not​ go; remains at​ $600; inflation Your answer is correct. D. ​goes; increases to​ $600; inflation

1. An unexpected increase in exports increases aggregate demand by​ $50 billion. What happens to the price level and real​ GDP? Has Shell Island experienced inflation or deflation and what type of output gap does it now​ have? The price level​ _____ and real GDP​ _____ billion. Shell island has experienced​ _____ . A. rises to​ 120; increases to​ $625; inflation and has a recessionary gap B. falls to​ 120; increases to​ $425; a​ one-time change in the price level and has an inflationary gap C. falls to​ 130; decreases to​ $500; deflation and has a recessionary gap D. rises to​ 130; increases to​ $625; a​ one-time change in the price level and has an inflationary gap Your answer is correct. Part 2 2. The price of oil falls unexpectedly and aggregate supply increases by​ $50 billion. What type of output gap​ appears? If the central bank responds to close the output​ gap, does Shell Island experience inflation or​ deflation? ​_____ gap appears and the central bank closes the output​ gap, aggregate demand​ _____ and a​ _____ is created. A. A​ recessionary; increases;​ demand-pull inflation B. An​ inflationary; decreases;​ cost-push deflation Your answer is correct. C. A​ recessionary; increases;​ demand-pull deflation D. An​ inflationary; decreases;​ cost-push inflation Part 3 3. The government of Shell Island announces an increase in spending of​ $50 billion a year and the central bank will increase the quantity of money to pay for the spending. Does the economy go into a​ boom? Will there be​ inflation? The economy​ _____ into a​ boom, real GDP​ _____ billion, and​ _____ arises. A. ​goes; remains at​ $600; inflation B. ​goes; increases to​ $600; inflation C. does not​ go; remains at​ $600; inflation Your answer is correct. D. does not​ go; decreases to​ $600; deflation

When the government announces an increase in spending of​ $50 billion a​ year, aggregate demand increases and the increase in aggregate demand is anticipated. Because the central bank increases the quantity of​ money, businesses anticipate the rise in the price​ level, so the money wage rises. Aggregate supply decreases. Real GDP remains at​ $600 billion and no output gap is​ created, but an anticipated inflation occurs. Key​ Point: An anticipated increase in aggregate demand accompanied by an increase in the quantity of money creates an anticipated inflation spiral with the economy at full employment. Next question

Given the information in the news clip​ ("falling unemployment with no increase in​ inflation"), what is happening to the​ short-run and​ long-run Phillips​ curve?

With a lower expected inflation​ rate, an economy can experience both falling unemployment and no increase in inflation. As the expected inflation rate​ falls, the​ short-run Phillips curve shifts downward and the​ long-run Phillips curve does not change. A. The​ long-run Phillips curve shifted leftward but the​ short-run Phillips curve has not changed. B. The​ short-run Phillips curve and the​ long-run Phillips curve are no longer relevant. C. A low expected inflation rate shifted the​ short-run Phillips curve downward with no change in the​ long-run Phillips curve Your answer is correct. D. A movement has occurred down the​ short-run Phillips curve and down the​ long-run Phillips curve.

According to RBC​ theory, the source of the business cycle is​ _______, which result mainly from​ _______.

fluctuations in​ productivity; fluctuations in the pace of technological change