Author Question: Many economists argue that, in the long run, the economy self-corrects and achieves full employment. ... (Read 80 times)

Awilson837 · **on:** Jun 30, 2018

Many economists argue that, in the long run, the economy self-corrects and achieves full employment. This argument is known as the:
a. natural rate hypothesis.
b. incomes policy approach.
c. political business cycle theory.
d. Keynesian cross model.

Question 2

Consider an economy with only two goods: bread and wine. In 1982, the typical family bought 4 loaves of bread at 50 per loaf and 2 bottles of wine for 9 per bottle. In Year X, bread cost 75 per loaf and wine cost 10 per bottle. The CPI for Year X (using a 1982 base year) is:
a. 100.
b. 115.
c. 126.
d. 130.