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