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Phase in which employment rises, and production and income increase.
1-depression
2- expansion
3- peak
4-recession
5-trough
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Solved in 2 steps
- 1. Real GDP decreases during (a).The movement from through to peak (b). The movement from below potential GDP back to potential GDP. (c).A decrease in unemployment (d). The movement from peak to through.61)Which of the following is TRUE? Select one: a. Real GDP in the U.S. is 12 trillion dollars. b. The Smoot Hawley Tariff Act caused AD to shift to the RIGHT in the Great Depression. c. Adam Smith wrote the General Theory of Employment, Interest, and Income d. During the Great Depression, economic policy was guided by the teachings of Classical economicsimportance of employment and unemployment? explain both terms.
- During 2008-2009, the U.S. economy suffered a 3.1% cumulative loss of GDP, which is equivalent to a loss of A,B,C, OR D ONE ANSWER A 50% of the unemployment rate. B inflation. C one year’s average growth of GDP. D deflation.An economy has 100 people divided among the following groups: 25 have full-time jobs, 20 have one part-time job, 5 have two part-time jobs, 10 would like to work and are looking for jobs, 10 would like to work but are so discouraged they have given up looking, 10 are running their own businesses, 10 are retired, and 10 are small children. a) Calculate the size of the labor force and the labor-force participation rate. b) Calculate the number of unemployed and the unemployment rate. c) Calculate total employment in two ways: as measured by the household survey and as measured by the establishment survey.1.2 Which of the following conditions would not be studied by the macroeconomist?a) The level of national unemployment during 1988.b) The effect of government economic policy on the inflation rate during 1987.c) The effect of changing petroleum prices on the demand for coal.d) The effect of lower income taxes on the rate of economic growth.
- The consumer price index is subject to the substitution bias and the quality/new good bias. Are the producer price index and the GDP deflator also subject to these biases? Why or why not?Define the three macroeconomic variables (inflation, unemployment, growth)A changing-basket price index (Passche index) like the GDP deflator tends to:a. underestimate the change in the cost of living because it does not take into account that people can substitute less-expensive goods for ones that become more expensive.b. overestimate the change in the cost of living because the continual introduction of new goods makes consumers better off even if prices do not fall.c. underestimate the change in the cost of living because it does not reflect the reduction in consumers’ welfare that may result from the substitutions of less expensive goods for more expensive ones.d. overestimate the change in the cost of living because it takes into account that people can substitute less expensive goods for more expensive ones.
- If economic growth occurs with demand increasing faster than supply, then Select one: a. Price level will decrease b. Price level will not change c. Price level will rise d. nominal wage will fall1. It shows the peak of a business cycle. A. Recession B. Recovery C. Prosperity D. Depression 2. It shows that both production and employment fall. A. Recession B. Recovery C. Prosperity D. Depression 3. It pertains to the situation whereby both production and employment are at their lowest levels. A. Recession C. Prosperity Recovery D. Depression 4. It is a point in business cycle whereby both production and employment are rising towards full employment. A. Recession B. Recovery C. Prosperity D. DepressionIdentify two groups that benefit from deflation and two that lose.
