Which of the following offers an example of frictional unemployment?
a. The rise in unemployment for stable workers after the development of gasoline-powered automobiles and the resulting long-tern decline in horse-and-buggy transportation.
b. The rise in unemployment among farm workers after harvest.
c. Unemployment resulting from the business cycle.
d. None of the above are correct.
b
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The Coffee Nook, a small cafe near campus, sells cappuccinos for $2.50 and Russian tea cakes for $1.00 each. What is the opportunity cost of buying a cappuccino?
A) $1.00 B) $2.50 C) 2/5 of a Russian tea cake D) 2 1/2 Russian tea cakes
During the mid-1980s, we observed a significant reduction in oil prices. In the United States, we would expect that this reduction in oil prices would cause
A) a larger reduction in the CPI compared to the GDP deflator. B) an equal reduction in the CPI and GDP deflator. C) a larger reduction in the GDP deflator compared to the CPI. D) no change in the CPI and a reduction in the GDP deflator.