The concept of mean reversion is defined by
a. the tendency of profits to revert to zero
b. the tendency of costs to revert to zero
c. the tendency of economic profits to revert to zero
d. the tendency of profits to revert to negative
c
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Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real GDP and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. Real GDP rises, and reserve-related (central bank) transactions become more positive (or less negative). b. Real GDP rises, and reserve-related (central bank) transactions remain the same. c. Real GDP and reserve-related (central bank) transactions remain the same. d. There is not enough information to determine what happens to these two macroeconomic variables. e. Real GDP falls, and reserve-related (central bank) transactions remain the same.
________ unemployment occurs due to a mismatch between the jobs that are available and the skills of workers seeking jobs.
A. Structural B. Cyclical C. Frictional D. Voluntary