Which of the following statements is true of unemployment?
A) In periods of contraction, the unemployment rate in an economy decreases.
B) The unemployment rate in most of the developed nations in the world is zero percent.
C) In periods of expansion, the unemployment rate in an economy increases.
D) The rate of unemployment is positive in any well-functioning economy.
Question 2
If the realized real interest rate in an economy is 6, the nominal interest rate is 8, and the expected inflation rate is 8, then the realized inflation rate in the economy is:
A) 2. B) 4. C) 8. D) 6.
In 2008, the U.S. economy suffered a gaping wound as several trillion dollars were ripped out of it.
Which is TRUE about the alternation of generations cycle that is diagramed above?
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