What is the principal reason that economists give for the existence of deflationary and inflationary gaps?
a. Wages are flexible in the short run.
b. Wages are flexible in the long run.
c. Wages are fixed in the long run.
d. Wages are fixed in the short run.
d
Economics
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The natural unemployment rate is 4 percent and the actual unemployment rate is 7 percent. According to Okun's Law, how does of real GDP compare to potential GDP?
What will be an ideal response?
Economics
In a perfectly competitive world:
A) two-way trade would not occur. B) one-way trade would not occur. C) neither one-way trade nor two-trade would occur. D) both one-way trade and two-way trade would occur.
Economics