Reference no: EM132479038

Autoworkers agree to a cut in their nominal wage rate. This event ___ short run aggregate supply and ___ long run aggregate supply.

• decreases, does not change
• increases, does not change
• decreases, does change
• does not change, does not change
• increases, increases

Assume the reference base period is 2002. a consumer price index of 122 in 2018 means that

• the average of the prices paid by urban consumers for a fixed market basket of consumer goods and services was 22 percent higher in 2018 than it was on average during 2002
• if the price of a good was $100 in 2002, its price in 2018 is $122
• the market basket of consumer goods that cost $122 in 2002 can be purchased for $100 in 2018
• prices of consumer goods have more than doubled
• prices of consumer goods have gone up by a factor of 12.2

Which of the following situations illustrates how monetary policy can influence aggregate demand?

• The government increases its expenditure by building more infrastructure thus increasing aggregate demand
• The government reduces personal income taxes. As a result, consumption expenditure increases and aggregate demand increases
• The bank of canada raises interest rates so people plan to buy less consumer durable goods like appliances. As a result, aggregate demand decreases and the price level falls
• The government increases transfer payments to individuals thus increasing consumption expenditure and aggregate demand
• The exchange rate value of Canadian dollar appreciates. As a result, Canadians living near the US Canada border increase their imports of goods and the net exports decrease

Which of the following is a false statement?

• A recession is a period of negative growth rate GDP that lasts at least two quarters
• Since 1960, the canadian labour force participation rate has trended higher and the unemployment rate has varied over the business cycle
• Since the mid-1960s, Canadian labour force participation rates have trended higher for females and lower for males
• A recession is a period of negative growth rate in nominal GDP that lasts at least twi quarters
• Labour force participation rates in Canada are higher for those 25 to 54 than youth 15 to 20 years of age

Which of the following statements by politicians is talking about the business cycle

• Business always rises just before Christmas
• Canadian unemployment is falling due to the upturn in the economy
• More capital investment will create more jobs
• Crime rates increase every spring as the school year ends
• An average of 220000 new jobs are created each year in Canada