QUIZ-III-ECO-3203-F2003-sola

Answer d 56 the response of output following a

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Unformatted text preview: uch government control over prices and the distribution of raw materials during the period. Answer: (d) 56) The response of output following a natural disaster includes a) an increase in aggregate demand and an increase in aggregate supply. b) an increase in aggregate demand and a decrease in aggregate supply. c) a decrease in aggregate demand and an increase in aggregate supply. d) a decrease in aggregate demand and a decrease in aggregate supply. Answer: (b) 57) The equilibrium effects of a temporary increase in total factor productivity include a) an increase in the real wage and an increase in the real interest rate. b) an increase in the real wage and a decrease in the real interest rate. c) a decrease in the real wage and an increase in the real interest rate. d) a decrease in the real wage and a decrease in the real interest rate. Answer: (b) 10 58) How many of the following business cycle facts can be explained if the primary cause of business cycles are temporary changes in total factor productivity: procyclical consumption, procyclical investment, procyclical employment, and procyclical real wages? a) one b) two c) three d) four Answer: (d) 59) The asymmetric nature of the economy’s response to oil price shocks is most likely explained by a) different government policy responses. b) the way in which firms adapt to higher energy prices. c) asymmetric labor supply responses. d) differences in the underlying causes of increases and decreases in oil prices. Answer: (b) 60) The equilibrium effects of a prospective future increase in total factor productivity include a) an increase in the real wage and an increase in the real interest rate. b) an increase in the real wage and a decrease in the real interest rate. c) a decrease in the real wage and an increase in the real interest rate. d) a decrease in the real wage and a decrease in the real interest rate. Answer: (c) 11...
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