Refer to the diagram for a specific economy. The shape of this curve suggests that:
A. the price level rises at a diminishing rate as the level of aggregate demand increases.
B. full employment and price stability are compatible goals only when aggregate demand is
falling.
C. each successive unit of decline in the unemployment rate is accompanied by a smaller
increase in the rate of inflation.
D. each successive unit of decline in the unemployment rate is accompanied by a larger increase in the rate of inflation.
D. each successive unit of decline in the unemployment rate is accompanied by a larger increase in the rate of inflation.
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Real GDP does not show the state of economic welfare in a country in part because GDP omits
I. household production. II. leisure time available. III. the quality of the environment. A) I only B) I and III C) II and III D) I, II and III
In the United States, over the past 40 years federal revenues as a share of gross domestic product have
A) risen steadily and now are about 40 percent. B) fallen below 10 because of rapid economic growth. C) been limited by law to no more than 20 percent. D) ranged between 17 and 19 percent.