Question 1: A business cycle refers to: the short-run fluctuations in real GDP. the life-cycle of...
Question 1:
A business cycle refers to:
-
the short-run fluctuations in real GDP.
-
the life-cycle of firms from infancy to maturity.
-
the flow of goods and services and factors of production through the economy.
-
the long-run trend of increasing real GDP.
Question 2:
Which of the following industries would experience the greatest increase in demand during an expansion?
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Accounting services.
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Baby supply industry.
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Hair care industry.
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The furniture industry.
Homework Answers
a) "A"
A business cycle is a short run fluctuation is real GDP. the answer is "A".
b) "C"
The hair care industry as this is considered as discretionary expenditure and it will increase only at the time of expansions.
Add Answer to:
Question 1:
A business cycle refers to:
the short-run fluctuations in real GDP.
the life-cycle of...
All societies experience short-run economic fluctuations around long-run trends. These fluctuations are irregular and largely unpredictable....
All societies experience short-run economic fluctuations around long-run trends. These fluctuations are irregular and largely unpredictable. When recessions do occur, real GDP and other measures of income, spending, and production fall, and unemployment rises. Any event or policy that raises consumption, investment, government expenditures, or net exports at a given price level increases aggregate demand, vice versa. Questions a) Which variable, investment or consumer spending has more affect on the business cycle? Why? (6 points) b) Name two macroeconomic variables...
QUESTION 19 The cyclical deficit is the portion of the deficit created by business cycle fluctuations...
QUESTION 19 The cyclical deficit is the portion of the deficit created by business cycle fluctuations in GDP. that is the result of nondiscretionary federal spending the result of discretionary federal spending. that would exist if the economy were at potential GDP QUESTION 20 A subsidy paid to buyers to correct a market with a positive externality shifts the demand curve leftward. supply curve leftward. supply curve rightward. demand curve rightward.
1. Aggregate supply definitions The short-run aggregate supply curve shows: What happens to output in an...
1. Aggregate supply definitions The short-run aggregate supply curve shows: What happens to output in an economy when the government spends more money How firms respond to changes in interest rates Changes in output in an economy as the price level changes, holding all other determinants of real GDP constar The relationship between the price level and aggregate expenditure Which of the following are assumed to remain unchanged along a given short-run aggregate supply curve? Check all that The price...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
Economics: 1) Why is it possible to change real economic factors in the short run simply...
Economics: 1) Why is it possible to change real economic factors in the short run simply by printing and distributing more money? 2) Explain why a stable 5% inflation rate can be preferable to one that averages 4% but varies between 1-7% regularly. 3) Explain the difference between active and passive monetary policy. 4) Suppose the economy is in long-run equilibrium, with real GDP at $16 trillion and the unemployment rate at 5%, Now assume that the central bank unexpectedly...
1. Key facts about economic fluctuations The following graph approximates business cycles in the United States...
1. Key facts about economic fluctuations The following graph approximates business cycles in the United States from the first quarter of 1947 to the third quarter of 1951. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP). 2170 REAL GDP (Billions of dollars) 1770 1947 1948 1950 1 1951 1949 YEAR Source: "Current-dollar and Real GDP," Bureau of Economics Analysis, last modified May 1, 13, accessed May 15, 13,...
1. Key facts about economic fluctuations The following graph approximates business cycles in the United States...
1. Key facts about economic fluctuations
The following graph approximates business cycles in the United
States from the first quarter of 1955 to the third quarter of 1959.
The vertical blue bar coincides with periods of 6 or more months of
declining real gross domestic product (real GDP).
Notice that real GDP trends upward over time but experiences ups
and downs in the short run. A period of declining real GDP, such as
the blue-shaded period in 1957, is known...
Chapter 14. Question 2. For example, an increase in the money supply, a (real or nominal?)...
Chapter 14. Question 2.
For example, an increase in the money supply, a (real or
nominal?) variable, will cause the price level, a
(nominal or real?) variable, to increase but will
have no long-run effect on the quantity of goods and services the
economy can produce, a (nominal or real?)
variable. The separation of real variables and nominal variables is
known as (the classical dichotomy, price neutrality, or the
quantity theory?).
The horizontal axis of the model of aggregate demand...
Question 83 (Mandatory) (1 point) Which term refers to the rate of unemployment that occurs when...
Question 83 (Mandatory) (1 point) Which term refers to the rate of unemployment that occurs when the economy is producing its potential GDP? a) the natural rate of unemployment b) cyclical unemployment c) structural unemployment d) the normal rate of unemployment Question 84 (Mandatory) (1 point) Exhibit 14-3 Price level Potential output LRAS SRAS AD Real GDP Refer to the graph in the exhibit. In this situation, how could the Bank of Canada return the economy to potential output? a)...
1. Key facts about economic fluctuations The following graph approximates business cycles in the United States...
1. Key facts about economic fluctuations The following graph approximates business cycles in the United States from the first quarter of 1955 to the third quarter of 1959. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP). 2800 2700 REAL GDP (Billions of dollars) 2600 2500 2400 1955 1956 1958 1957 YEAR 1959 Source: "Current-dollar and Real GDP," Bureau of Economics Analysis, last modified May 1, 13, accessed May...
All societies experience short-run economic fluctuations around long-run trends. These fluctuations are irregular and largely unpredictable. When recessions do occur, real GDP and other measures of income, spending, and production fall, and unemployment rises. Any event or policy that raises consumption, investment, government expenditures, or net exports at a given price level increases aggregate demand, vice versa. Questions a) Which variable, investment or consumer spending has more affect on the business cycle? Why? (6 points) b) Name two macroeconomic variables...
QUESTION 19 The cyclical deficit is the portion of the deficit created by business cycle fluctuations in GDP. that is the result of nondiscretionary federal spending the result of discretionary federal spending. that would exist if the economy were at potential GDP QUESTION 20 A subsidy paid to buyers to correct a market with a positive externality shifts the demand curve leftward. supply curve leftward. supply curve rightward. demand curve rightward.
1. Aggregate supply definitions The short-run aggregate supply curve shows: What happens to output in an economy when the government spends more money How firms respond to changes in interest rates Changes in output in an economy as the price level changes, holding all other determinants of real GDP constar The relationship between the price level and aggregate expenditure Which of the following are assumed to remain unchanged along a given short-run aggregate supply curve? Check all that The price...
Long run aggregate supply is the relationship between the quantity of real GDP supplied and the price level when the maintain full employment changes in step with the price level to O A. money wage rate OB. quantity of money OC. real wage rate OD. interest rate supplied and the when the money wage rate, the prices of other resources and Short run aggregate supply is the relationship between the quantity of potential GDP remain constant O A real GDP...
1. Key facts about economic fluctuations The following graph approximates business cycles in the United States from the first quarter of 1947 to the third quarter of 1951. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP). 2170 REAL GDP (Billions of dollars) 1770 1947 1948 1950 1 1951 1949 YEAR Source: "Current-dollar and Real GDP," Bureau of Economics Analysis, last modified May 1, 13, accessed May 15, 13,...
1. Key facts about economic fluctuations
The following graph approximates business cycles in the United
States from the first quarter of 1955 to the third quarter of 1959.
The vertical blue bar coincides with periods of 6 or more months of
declining real gross domestic product (real GDP).
Notice that real GDP trends upward over time but experiences ups
and downs in the short run. A period of declining real GDP, such as
the blue-shaded period in 1957, is known...
Chapter 14. Question 2.
For example, an increase in the money supply, a (real or
nominal?) variable, will cause the price level, a
(nominal or real?) variable, to increase but will
have no long-run effect on the quantity of goods and services the
economy can produce, a (nominal or real?)
variable. The separation of real variables and nominal variables is
known as (the classical dichotomy, price neutrality, or the
quantity theory?).
The horizontal axis of the model of aggregate demand...
Question 83 (Mandatory) (1 point) Which term refers to the rate of unemployment that occurs when the economy is producing its potential GDP? a) the natural rate of unemployment b) cyclical unemployment c) structural unemployment d) the normal rate of unemployment Question 84 (Mandatory) (1 point) Exhibit 14-3 Price level Potential output LRAS SRAS AD Real GDP Refer to the graph in the exhibit. In this situation, how could the Bank of Canada return the economy to potential output? a)...
1. Key facts about economic fluctuations The following graph approximates business cycles in the United States from the first quarter of 1955 to the third quarter of 1959. The vertical blue bar coincides with periods of 6 or more months of declining real gross domestic product (real GDP). 2800 2700 REAL GDP (Billions of dollars) 2600 2500 2400 1955 1956 1958 1957 YEAR 1959 Source: "Current-dollar and Real GDP," Bureau of Economics Analysis, last modified May 1, 13, accessed May...
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