When a new firm considers entering a market, it takes into account only the profit it would make. What are the two external effects that occur in the market that the firm does not consider?

Assume that the full-employment level of output is $5000 billion and the natural unemployment rate is 5%. Suppose the current unemployment rate is 8%

What would be the current level of output according to Okun's law (when the Okun's law coefficient is 2)? A) $4500 billion B) $4700 billion C) $4900 billion D) $5000 billion

Inflation reduces the multiplier effect by reducing consumers' wealth and purchasing power

a. True b. False Indicate whether the statement is true or false