Refer to Table 1. What is the labor force participation rate of the economy? a.

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Refer to Table 1. What is the labor force participation rate of the economy? a. 15 percent b. 25 percent c. 60 percent d. 75 percent 6. -7. In a property operating and full-employment economy a. the unemployment rate should remain near zero. b. we would expect to have some unemployment due to normal structural and frictional factors. c. the rate of unemployment will be very high during economic booms. d. the employment/population ratio should average 100 percent. -8. If the Consumer Price Index in 2001 was l 50 and the CPI in 2002 was 165, the rate of inflation between 2001 and 2002 would be a. 9.09 percent. 6 0 b. 10 percent. c. 15 percent. d. 110 percent. 9. Suppose that inflation is expected to be 4 percent during the year. If the real rate of interest is 5 percent, the money rate (nominal rate) of interest must be a. 1 percent. b. 4 percent c. 5 percent. d. 9 percent. 10. Which of the following best describes a consumption function? a. a function that relates consumption to savings b. a function that relates investment to the interest rate c. a function that relates consumption to disposable income d. All of the above are correct, the consumption function includes all three relationships. 11. When the marginal propensity to consume is 3/4, and an economy operates well below its full- employment capacity, in the Keynesian model a $25 billion increase in investment expenditures will cause GDP to rise (assuming the full impact of the multiplier is instantaneous) a. $25 billion. b. $50 billion. c. $75 billion. d. $100 billion. In the Keynesian expenditure model, the equilibrium level of income is achieved when a. the employment rate equals approximately 96 percent. b. actual saving equals actual investment. 12. c. planned aggregate expenditures exceed actual output d. actual output equals planned aggregate expenditures.

Explanation / Answer

7) THe answer is B -) we would expect to have some unemployment due to normal structural and frictional factors.

because at full employment situation, exist when there is 0% cyclic unemployment or deficient-demand unemployment but there must be exist of some structural, frictional and voluntary unemployment. a structural unemployment is the unemployment which is caused due to mismatch is available jobs for the skilled worker.and frictional unemployment is the situtation of unemployment when moving from one job to another.

8) please uplaod it again. it against chegg policy

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