Filters
Question type
Study Flashcards

An event that directly affects firms' costs of production and thus the prices they charge is called


A) a Phillips contraction.
B) an inflationary spiral.
C) a demand shock.
D) a supply shock.

E) All of the above
F) C) and D)

Correct Answer

verifed

verified

By raising aggregate demand more than anticipated, policymakers


A) reduce unemployment for awhile.
B) raise unemployment for awhile.
C) reduce unemployment permanently.
D) None of the above is correct.

E) B) and C)
F) A) and C)

Correct Answer

verifed

verified

Suppose the Federal Reserve pursues contractionary monetary policy. In the long run


A) both inflation and the unemployment rate are higher than they were prior to the change in policy.
B) inflation is higher and the unemployment rate is the same as it was prior to the change in policy.
C) inflation is lower and the unemployment rate is lower than it was prior to the change in policy.
D) inflation is lower and unemployment is the same as it was prior to the change in policy.

E) A) and D)
F) C) and D)

Correct Answer

verifed

verified

D

Suppose the price level is 115.00 at the end of 2020, 112.02 at the end of 2021, and 109.08 at the end of 2022. Can we accurately describe the period 2021-2022 as a period of disinflation?

Correct Answer

verifed

verified

No. Since the price level is falling over the period, it is accurate to characterize the period as one of deflation, rather than disinflation.

Figure 35-1. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD curves. On the right-hand diagram, U represents the unemployment rate. Figure 35-1. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD curves. On the right-hand diagram, U represents the unemployment rate. -Refer to Figure 35-1. What is measured along the vertical axis of the right-hand graph? A) the interest rate B) the inflation rate C) the wage rate D) the growth rate of the nominal money supply Figure 35-1. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD curves. On the right-hand diagram, U represents the unemployment rate. -Refer to Figure 35-1. What is measured along the vertical axis of the right-hand graph? A) the interest rate B) the inflation rate C) the wage rate D) the growth rate of the nominal money supply -Refer to Figure 35-1. What is measured along the vertical axis of the right-hand graph?


A) the interest rate
B) the inflation rate
C) the wage rate
D) the growth rate of the nominal money supply

E) None of the above
F) A) and D)

Correct Answer

verifed

verified

If the Federal Reserve increases the rate at which it increases the money supply, then unemployment is lower


A) in the long run and the short run.
B) in the long run but not the short run.
C) in the short run but not the long run.
D) in neither the short run nor the long run.

E) A) and B)
F) C) and D)

Correct Answer

verifed

verified

Which of the following would not be associated with a favorable supply shock?


A) the short-run Phillips curve shifts left
B) unemployment falls
C) the price level rises
D) output rises.

E) A) and B)
F) None of the above

Correct Answer

verifed

verified

Figure 35-1. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD curves. On the right-hand diagram, U represents the unemployment rate. Figure 35-1. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD curves. On the right-hand diagram, U represents the unemployment rate. -Refer to Figure 35-1. Assuming the price level in the previous year was 100, point G on the right-hand graph corresponds to A) point A on the left-hand graph. B) point B on the left-hand graph. C) point C on the left-hand graph. D) point D on the left-hand graph. Figure 35-1. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD curves. On the right-hand diagram, U represents the unemployment rate. -Refer to Figure 35-1. Assuming the price level in the previous year was 100, point G on the right-hand graph corresponds to A) point A on the left-hand graph. B) point B on the left-hand graph. C) point C on the left-hand graph. D) point D on the left-hand graph. -Refer to Figure 35-1. Assuming the price level in the previous year was 100, point G on the right-hand graph corresponds to


A) point A on the left-hand graph.
B) point B on the left-hand graph.
C) point C on the left-hand graph.
D) point D on the left-hand graph.

E) All of the above
F) A) and D)

Correct Answer

verifed

verified

Figure 35-3. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD) curves. On the left-hand diagram, Y represents output and on the right-hand diagram, U represents the unemployment rate. Figure 35-3. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD) curves. On the left-hand diagram, Y represents output and on the right-hand diagram, U represents the unemployment rate. -Refer to Figure 35-3. Assume the figure charts possible outcomes for the year 2018. In 2018, the economy is at point B on the left-hand graph, which corresponds to point B on the right-hand graph. Also, point A on the left-hand graph corresponds to A on the right-hand graph. The price level in the year 2018 is A) 155.56. B) 159.00. C) 163.50. D) 170.04. Figure 35-3. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD) curves. On the left-hand diagram, Y represents output and on the right-hand diagram, U represents the unemployment rate. -Refer to Figure 35-3. Assume the figure charts possible outcomes for the year 2018. In 2018, the economy is at point B on the left-hand graph, which corresponds to point B on the right-hand graph. Also, point A on the left-hand graph corresponds to A on the right-hand graph. The price level in the year 2018 is A) 155.56. B) 159.00. C) 163.50. D) 170.04. -Refer to Figure 35-3. Assume the figure charts possible outcomes for the year 2018. In 2018, the economy is at point B on the left-hand graph, which corresponds to point B on the right-hand graph. Also, point A on the left-hand graph corresponds to A on the right-hand graph. The price level in the year 2018 is


A) 155.56.
B) 159.00.
C) 163.50.
D) 170.04.

E) A) and D)
F) A) and C)

Correct Answer

verifed

verified

Which of the following describes the Volcker disinflation most accurately?


A) Almost all of the public believed that the Fed would keep money growth low, so unemployment rose less than it would have otherwise.
B) Almost all of the public believed that the Fed would keep money growth low, so unemployment rose more than it would have otherwise.
C) Much of the public did not believe that the Fed would keep money growth low, so unemployment rose less than it would have otherwise.
D) Much of the public did not believe that the Fed would keep money growth low, so unemployment rose more than it would have otherwise.

E) A) and D)
F) None of the above

Correct Answer

verifed

verified

Typical estimates of the sacrifice ratio suggest that about 10 percent of annual output has to be given up in order to reduce the inflation rate from


A) 8 percent to 4 percent.
B) 8 percent to 5 percent.
C) 7 percent to 5 percent.
D) 7 percent to 6 percent.

E) B) and D)
F) All of the above

Correct Answer

verifed

verified

What is meant by the natural rate of unemployment?

Correct Answer

verifed

verified

It is the rate of un...

View Answer

An adverse supply shock will cause output


A) and prices to rise.
B) and prices to fall.
C) to rise and prices to fall.
D) to fall and prices to rise.

E) A) and B)
F) None of the above

Correct Answer

verifed

verified

If people correctly anticipate that inflation will fall by 1%, then


A) the short-run Phillips curve shifts right and unemployment is unchanged.
B) the short-run Phillips curve shifts right and unemployment rises.
C) the short-run Phillips curve shifts left and unemployment is unchanged.
D) the short-run Phillips curve would shift left and unemployment falls.

E) None of the above
F) B) and D)

Correct Answer

verifed

verified

Figure 35-2 Use the pair of diagrams below to answer the following questions. Figure 35-2 Use the pair of diagrams below to answer the following questions. -Refer to Figure 35-2. If the economy starts at C and 1, then in the short run, an increase in taxes moves the economy to A) B and 2. B) D and 3. C) E and 2. D) None of the above is correct. Figure 35-2 Use the pair of diagrams below to answer the following questions. -Refer to Figure 35-2. If the economy starts at C and 1, then in the short run, an increase in taxes moves the economy to A) B and 2. B) D and 3. C) E and 2. D) None of the above is correct. -Refer to Figure 35-2. If the economy starts at C and 1, then in the short run, an increase in taxes moves the economy to


A) B and 2.
B) D and 3.
C) E and 2.
D) None of the above is correct.

E) A) and C)
F) C) and D)

Correct Answer

verifed

verified

By about 1973, U.S. policymakers had learned that


A) Friedman and Phelps's analysis of inflation and unemployment had been correct.
B) the short-run Phillips curve shifts when expectations of inflation change.
C) there is no long-run trade-off between inflation and unemployment.
D) All of the above are correct.

E) None of the above
F) A) and B)

Correct Answer

verifed

verified

The Economy in 2008 In the first half of June 2008 the effects of a housing and financial crisis and an increase in world prices of oil and foodstuffs were affecting the economy. -Refer to The Economy in 2008. Given the effects of the financial and housing crisis on the price level and output and the effects of increased world commodity prices on the price level and output, the aggregate demand and aggregate supply model tells us that


A) output rises and the price level falls.
B) output may rise, fall or stay the same and the price level rises.
C) output falls and the price level may rise, fall or stay the same.
D) None of the above is correct.

E) A) and C)
F) B) and D)

Correct Answer

verifed

verified

An adverse supply shock shifts the short-run Phillips curve to the left.

A) True
B) False

Correct Answer

verifed

verified

How are the effects of the financial crisis shown using the Phillips curve diagram?

Correct Answer

verifed

verified

As a move down along...

View Answer

Which of the following is vertical?


A) both the long-run Phillips curve and the long-run aggregate supply curve
B) neither the long-run Phillips curve nor the long-run aggregate supply curve
C) the long-run Phillips curve, but not the long-run aggregate supply curve
D) the long-run Phillips curve, but not the long-run aggregate supply curve.

E) A) and D)
F) A) and C)

Correct Answer

verifed

verified

A

Showing 1 - 20 of 516

Related Exams

Exam 1

Ten Principles of Economics

439 Questions

Exam 2

Thinking Like an Economist

615 Questions

Exam 3

Interdependence and the Gains From Trade

527 Questions

Exam 4

The Market Forces of Supply and Demand

697 Questions

Exam 5

Measuring a Nations Income

518 Questions

Exam 6

Measuring the Cost of Living

543 Questions

Exam 7

Production and Growth

507 Questions

Exam 8

Saving, Investment, and the Financial System

565 Questions

Exam 9

The Basic Tools of Finance

510 Questions

Exam 10

Unemployment and Its Natural Rate

698 Questions

Exam 11

The Monetary System

517 Questions

Exam 12

Money Growth and Inflation

484 Questions

Exam 13

Open-Economy Macroeconomics: Basic Concepts

520 Questions

Exam 14

A Macroeconomic Theory of the Open Economy

478 Questions

Exam 15

Aggregate Demand and Aggregate Supply

563 Questions

Exam 16

The Influence of Monetary and Fiscal Policy on Aggregate Demand

510 Questions

Exam 18

Six Debates Over Macroeconomic Policy

372 Questions

Show Answer