The two fundamental causes of unemployment at full employment are
A) demographic change and decreases in the demand for labor.
B) job search and job rationing.
C) seasonal jobs and technological change.
D) foreign competition and financial bankruptcies.
E) decreases in labor productivity and more generous retirement benefits.
Question 2
If the nominal interest rate is less than the equilibrium nominal interest rate determined in the money market, then households and firms
A) are holding less money than they prefer.
B) are holding more money than they prefer.
C) expect real GDP to increase.
D) expect the price level to increase.
E) expect the nominal interest rate to decrease.
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