A. in the long run the unemployment rate returns to the natural rate, regardless of inflation
B. Unemployment is always below the natural rate
C. Unemployment is always above the natural rate
D. Unemployment is always equal to the natural rate
Related Mcqs:
- For the United States suppose the annual interest rate on government securities equals 8 percent while the annual inflation rate equals 4 percent, For Switzerland the annual interest rate on government securities equal 10 percent while the annual inflation rate equals 7 percent the above variables would cause investment funds to flow from ?
A. the United States to Switzerland causing the dollar to depreciate
B. the United States to Switzerland causing the dollar to appreciate
C. Switzerland to the United States causing the franc to depreciate
D. Switzerland to the United States causing the franc to appreciate - For the United States suppose the annual interest rate on government securities equals 12 percent while the annual inflation rate equals 8 percent For Japan the annual interest rate on government securities equals 10 percent while the annual inflation rate equals 5 percent the above variables would cause investment funds to flow from ?
A. The United States to Japan causing the dollar to depreciate
B. The United States to Japan causing the dollar to appreciate
C. The Japan to United States, causing the dollar to depreciate
D. The Japan to United States, causing the dollar to appreciate - The measured unemployment rate can be pushed below the natural rate, but ?
A. only in the short run, and not without inflation
B. only in the long run and not without inflation
C. only is the short run and only if the price level is constant
D. only in the long run and only if the price level is constant - If the nominal interest rate is 7 percent and the inflation rate is 3 percent, then the real interest rate is ?
A. 4 percent
B. 10 percent
C. -4 percent
D. 3 percent
E. 21 percent - If a country’s policy makers were to continuously use expansionary monetary policy in an attempt to hold unemployment below the natural rate the long-run result would be ?
A. an increase in the level of output
B. a decrease in the unemployment rate
C. an increase in the rate of inflation
D. All of these answers - The rational-expectation hypothesis suggests that the forecasts that people make concerning future inflation rates ?
A. consistently overestimate the actual rate of inflation in the future.
B. are always correct
C. consistently underestimate the actual rate of inflation in the future
D. are correct on average, but are subject to errors that are distributed randomly - The hypothesis that people know the true model of the economy and that they use this model to form their expectations of the future is the ?
A. Rational-expectations hypothesis
B. Passive-expectations hypothesis
C. adaptive expectations hypothesis
D. lagged-expectations hypothesis. - Theodore panayotou (1993) argues that environment degradation originates from the following EXCEPT ?
A. markets distortions
B. defective economic policies
C. inadequate property
D. the expansion of capitalism - Simon S.Kuznets argues that the major stock of an economically advanced country is not its physical capital but ?
A. natural resources
B. body of knowledge
C. land
D. quantity of labor - Deepak Lal argues that development economics is dominated by _______ approach that favors government intervention into LDC prices?
A. dirigiste
B. Keynesian
C. Commanding heights
D. soft budget
