Cyclical unemployment is negative when
A. the actual unemployment rate exceeds the natural rate.
B. the economy is at the peak of a business expansion.
C. the inflation rate is negative.
D. the inflation rate is positive.
Answer: B
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Why do fads often lead to shortages, at least in the short term?
A. Demand increases too quickly and unexpectedly for the supply to keep up. B. Laws prevent stores from responding to excess demand in time to prevent a shortage. C. Buyers and sellers are unable to agree on a price for the good. D. Manufacturers charge such high prices for the goods that stores are unwilling to pay.
In early 1996, Congress passed the "Freedom to Farm Bill.". Following the bill's enactment,
a. farmers found that competition from international agriculture declined. b. farm prices rose steadily for the next 4 years. c. agriculture was completely deregulated, and farmers began to operate without any government subsidies or assistance. d. farm prices fell, leading Congress to authorize emergency payments to farmers in 1998 and 1999.