Test #8, Chapter 9

Answer the questions below and then click "submit" to send your answers.

  1. Internal causes of an economy’s business cycles include

    2. Your answer:
    innovation
    multiplier and accelerator interactions
    extreme weather
    war
    sunspots

  2. Admitting the existence of “administrative lag” could cause one to conclude

    3. Your answer:
    countercyclical fiscal policy will always be ineffective
    implementation of countercyclical fiscal policy will be delayed
    identification of business cycles will be delayed
    monetary policy will be better than fiscal policy
    political realities result in economic compromise

  3. A problem when implementing countercyclical fiscal policy is

    4. Your answer:
    finding the natural unemployment rate
    knowing when the balanced budger multipllier equals 1.0
    identifying which multiplier to use
    knowing where the turning point is
    difining the accelerator

  4. How much capital each laborer works with is referred to as the

    5. Your answer:
    capital deepening
    labor productivity
    the capital-labor ratio
    the marginal factor of capital to labor ratio
    capital productivity

  5. If K = capital and L = labor, then output per laborer is

    6. Your answer:
    L/GDP
    GDP/K
    GDP/L
    K/L
    L/K

  6. If 100 lumberjacks generate $5,000 in real GDP, the output per laborer would be

    7. Your answer:
    0.02
    5,000
    0.05
    50
    100

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