An advocate of the classical model of the economy would claim that unemployment is created when the ____ is above its equilibrium level in the ______?

Related Mcqs:

1. If the economy is in the expansionary phase of the business cycle, aggregate demand ____ unemployment ____ inflation ____ payments is likely to move towards ____?

   A. falls; rise; falls; surplus
   B. is static; low; rise; deficit;
   C. falls; falls; falls; surplus
   D. rise; falls; rises; deficit

2. Unemployment resulting from real wages being above their equilibrium level is called _________ unemployment?

   A. natural
   B. frictional
   C. disequilibrium
   D. structural

3. Suppose the economy is initially in long run equilibrium Then suppose there is a drought that destroys much of the wheat crop if policymakers allow the economy to adjust to long-run equilibrium on its own, according to the model to aggregate demand and aggregate supply what happens to prices and output in the long run ?

   A. Output rises; prices are unchanged from the initial value
   B. Output and the price level are unchanged from their initial values
   C. Output falls; prices are unchanged from the initial value
   D. Prices fall; output is unchanged from its initial value

4. If the economy is in the though phase of the business cycle, aggregate demand ____ unemployment ______ inflation ______ and the current account of the balance of payments is likely to move towards ________?

   A. falls; falls; falls; surplus
   B. falls; rises; falls; surplus
   C. is static; low; rises; deficit
   D. rises; falls; rises; deficit

5. The Keynesian model is a good guide to ____ behavior and the classical model describes behavior in ______?

   A. long run, short run
   B. flexible imperfect markets
   C. short-term long run
   D. long run, imperfect markets

6. If the economy is in the recessionary phase of the business cycle, aggregate demand ___ unemployment ____ inflation ___ and the current account of the balance of payments is likely to move towards ____?

   A. falls; falls; falls; surplus
   B. is static; low; rises; deficit
   C. falls; rises; falls; surplus
   D. rises; falls; rises; deficit

7. Unemployment benefits may increase the unemployment rate because unemployment benefits ?

   A. encourage people to quit their jobs
   B. reduce the cost of job search
   C. enable people to quit searching for work
   D. reduce the benefits of additional job searching

8. Suppose two economists are arguing about policies that deal with unemployment. One economist says. The government could lower unemployment by one percentage point if it would just increase government spending by 50 billion dollars the other economist responds Nonsense and poppycock! If the government spent an additional 50 billion dollars it would reduce unemployment by only one tenth of one percent. and that effect would only be temporary! These economists ?

   A. None of these answers
   B. Disagree because they have different scientific judgments
   C. really don’t disagree at all. It just appears that they disagree
   D. disagree because they have different values

9. Unemployment resulting from changes in the pattern of demand or supply in the economy is called _______ unemployment?

   A. regional
   B. technological
   C. structural
   D. demand-deficient

10. Unemployment resulting from imperfect information in the labour market is called ____ unemployment?

    A. Frictional
    B. natural
    C. real-wage
    D. disequilibrium