Author Question: We use a two-period model because A) the business cycle has two phases: contraction and recovery. ... (Read 137 times)

berenicecastro · **on:** Jun 30, 2018

We use a two-period model because

A) the business cycle has two phases: contraction and recovery.
B) it is the simplest dynamic model.
C) we want to make a distinction between young and old households.
D) this is the horizon of the politicians that formulate policy.

Question 2

If real GDP helps to predict the path of a particular macroeconomic variable, it is said to be a

A) conventional variable.
B) coincident variable.
C) leading variable.
D) lagging variable.