When a recession occurs, do economists expect it to be a temporary phenomenon? Or is there some degree of permanence? What is the empirical evidence?
What will be an ideal response?
Recent research suggests that recessions may contain permanent components. Some economists argue that only the 1973-1975 recession led to a permanent change in the U.S. economy, because it changed the economy's use of oil permanently. Other studies suggest that perhaps 30% of changes in real output are permanent and 70% are temporary for the postwar United States.
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A firm's decision to expand the size of its production facility would be considered a short-run decision so long as the expansion can be completed in less than a year
Indicate whether the statement is true or false
One explanation that economists give for the persistence of poverty in LDCs falls under the category of nonscientific perceptions. An example of this is people in LDCs who
a. are unwilling to devote their energies to intellectual pursuits b. don't share the values associated with the means to acquire or the acquisition of the materialist world commonly identified with Westerners c. are not rational, utility-maximizing, economic agents d. value their children e. because of climate, require a lower calorie diet to survive