Question 1

What would shift the long-run Phillips curve to the right?

Accepted Answer

A)  an increase in the money supply 
B)  a decrease in government spending 
C)  an increase in employment insurance 
D)  a decrease in the unemployment rate 
A)  an increase in the money supply 
B)  a decrease in government spending 
C)  an increase in employment insurance 
D)  a decrease in the unemployment rate

Question 2

Suppose the government passes legislation that decreases the natural rate of unemployment. How does this change the long- and short-run Phillips curves?

Accepted Answer

For the long-run Phillips curve, the cha

Question 3

What did Samuelson and Solow believe about the Phillips curve?

Accepted Answer

A)  It implied that low unemployment was associated with low inflation. 
B)  It indicated that the aggregate supply and aggregate demand model was incorrect. 
C)  It illustrated that policymakers face a tradeoff between inflation and unemployment. 
D)  It demonstrated that fiscal policies were ineffective in reducing unemployment. 
A)  It implied that low unemployment was associated with low inflation. 
B)  It indicated that the aggregate supply and aggregate demand model was incorrect. 
C)  It illustrated that policymakers face a tradeoff between inflation and unemployment. 
D)  It demonstrated that fiscal policies were ineffective in reducing unemployment.

Question 4

Figure 17-1  
-Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does a decrease in government expenditures move the economy?

Accepted Answer

A)  d and 2 
B)  d and 3 
C)  e and 3 
D)  e and 2 
A)  d and 2 
B)  d and 3 
C)  e and 3 
D)  e and 2

Question 5

Figure 17-1  
-Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does an increase in government expenditures move the economy?

Accepted Answer

A)  b and 2 
B)  e and 3 
C)  d and 3 
D)  c and 2 
A)  b and 2 
B)  e and 3 
C)  d and 3 
D)  c and 2

Question 6

If the sacrifice ratio is 2, reducing the inflation rate from 10 percent to 7 percent would require sacrificing how much annual output?

Accepted Answer

A)  2 percent of annual output 
B)  3 percent of annual output 
C)  5 percent of annual output 
D)  6 percent of annual output 
A)  2 percent of annual output 
B)  3 percent of annual output 
C)  5 percent of annual output 
D)  6 percent of annual output

Question 7

Figure 17-1  
-Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does an increase in the money supply move the economy?

Accepted Answer

A)  a and 1 
B)  b and 2 
C)  c and 3 
D)  a and 3 
A)  a and 1 
B)  b and 2 
C)  c and 3 
D)  a and 3

What would shift the long-run Phillips curve to the right?

Suppose the government passes legislation that decreases the natural rate of unemployment. How does this change the long- and short-run Phillips curves?

What did Samuelson and Solow believe about the Phillips curve?

Figure 17-1 -Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does a decrease in government expenditures move the economy?

Figure 17-1 -Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does an increase in government expenditures move the economy?

If the sacrifice ratio is 2, reducing the inflation rate from 10 percent to 7 percent would require sacrificing how much annual output?

Figure 17-1 -Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does an increase in the money supply move the economy?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary Policy on Aggregate Demand

The Influence of Fiscal Policy on Aggregate Demand

Five Debates Over Macroeconomic Policy

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Exam 17: The Short-Run Tradeoff Between Inflation and Unemployment

What would shift the long-run Phillips curve to the right?

Suppose the government passes legislation that decreases the natural rate of unemployment. How does this change the long- and short-run Phillips curves?

What did Samuelson and Solow believe about the Phillips curve?

Figure 17-1 -Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does a decrease in government expenditures move the economy?

Figure 17-1 -Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does an increase in government expenditures move the economy?

If the sacrifice ratio is 2, reducing the inflation rate from 10 percent to 7 percent would require sacrificing how much annual output?

Figure 17-1 -Refer to Figure 17-1. If the economy starts at c and 1, then in the short run, where does an increase in the money supply move the economy?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary Policy on Aggregate Demand

The Influence of Fiscal Policy on Aggregate Demand

Five Debates Over Macroeconomic Policy

Filters