If unemployment is above its natural rate, what happens to move the economy to long-run equilibrium?
a. Inflation expectations rise which shifts the short-run Phillips curve to the right.
b. Inflation expectations rise which shifts the short-run Phillips curve to the left.
c. Inflation expectations fall which shifts the short-run Phillips curve to the right.
d. Inflation expectations fall which shifts the short-run Phillips curve to the left.
d
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When people base their estimates of the likelihood of an event on how often they've heard of such an event, they illustrate the:
A. Confirmation bias B. Framing effect C. Hindsight bias D. Availability heuristic
Which of the following is always associated with monopolistic competition?
A. identical products B. economic profits in the short run C. product differentiation D. Demand curves become more inelastic as new entry occurs.