Which one of the following is not a position taken by classical economists?
a. Problems of inflation and unemployment will disappear without government intervention
b. All markets are competitive.
c. All prices are flexible upward and downward.
d. Inflation occurs when the money supply grows faster than real GDP.
e. While government should not engage in countercyclical fiscal policy, it is appropriate that the Fed engage in countercyclical monetary policy.
E
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Which of the following is true about total factor productivity (TFP)?
A) it can be measured just like capital and labor B) it cannot be directly measured so it has to be calculated from given values of capital, labor and output C) while it cannot be measured directly, it has an exponent of 0.3 in the Cobb-Douglas production function D) while it cannot be measured directly, it has an exponent of 0.7 in the Cobb-Douglas production function E) none of the above
As the percentage of a group required for agreement approaches 100 percent, _____ costs _____
a. decision-making costs; increase b. decision-making costs; decrease c. political costs; increase d. political costs; decrease