What are the important mechanisms that reverse the effects of a recession in a modern economy? (Check all that apply.) A. Labor supply increases due to an increase in real wages. B. The multipliers on wages and employment return to normal. C. Labor demand increases due to expansionary government policies. D. Labor demand increases due to market forces. What market forces might cause the labor demand curve to shift back to the right? (Check all that apply.)

What are the important mechanisms that reverse the effects of a recession in a modern economy? (Check all that apply.) A. Labor supply increases due to an increase in real wages. B. The multipliers on wages and employment return to normal. C. Labor demand increases due to expansionary government policies. D. Labor demand increases due to market forces. What market forces might cause the labor demand curve to shift back to the right? (Check all that apply.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: 2) Part A: What prediction can you make about the inflation when a country is in war? Write your…

A: Since you have asked for part "A" so I am answering only part "A".

Q: What is the difference between a recession and a depression? A. A depression is the opposite of a…

A: Business cycle refers to the fluctuations in economic activity. It includes expansion and recession.…

Q: Which of the below did NOT happen during the Great Recession of Dec. 2007 - June 2009? Group of…

A: During financial crisis, banks had stopped lending and credit market freezed because of…

Q: Which of the following will most likely result from decreases in real wages and other resource…

A: The nominal wage is the monetary wage that the employee or the worker receives from their work. The…

Q: Y Real GDP AD

Q: What makes the 2007-2009 recession special? 1. because of the length of the recession 2. because of…

A: Great recession and the causes is complex and involve several forces.

Q: 67. Suppose that there is a sudden drop in government spending. What happens to the economy in the…

A: Answer: If there is a sudden drop in government spending then the aggregate demand curve will shift…

Q: 13. As a general rule, a recession is a decline in real GDP lasting at least: 3 quarters 1 month 6…

A: GDP is generally an indicator of economic growth and development of a nation. It represents…

Q: Refer to the table below. (SEE PICTURE) Suppose that aggregate demand increases such that the…

A: Equilibrium refers to the point where the demand curve intersects with the supply curve, here the…

Q: Wine Bread 1) See above. An economy operated at a full employment. Then the economy went into…

A: The production possibility curve is defined as the various combinations of goods or commodities at…

Q: 47. What is the difference between a recession and a depression? A depression is a particularly…

A: The ‘‘business cycle’’ refers to a fluctuation in production, employment, trade and general activity…

Q: 1. Using an example, explain how John Maynard Keynes distinguished macroeconomics from…

A: Inflation is a condition in the economy when there is a general rise in the price level of goods and…

Q: 17 The long-run aggregate supply curve shifts right if a technology advances. b the capital stock…

A: The long-run aggregate supply curve shows the potential output of the economy in the long run. It…

Q: 1.) If consumption falls, Keynesians believe unemployment will ________ for everyone, while…

A: Austrian economist Friedrich Hayek believed that the New Deal wasn’t sustainable. He felt that…

Q: Give typing answer with explanation and conclusion Suppose the real GDP of an economy is $500…

A: The difference between the unemployment rate and the natural rate of unemployment is cyclical…

Q: Households tend to increase their spending during a recession because they realize that more…

A: Recession:- Recession can be defined as a period of economic contraction during which economic trade…

Q: Comment on GDP as a Measure of Welfare • How do economists define output, the unemployment rate, and…

A: Gross Domestic Product (GDP) is a widely used measure of economic activity within a country. While…

Q: The vertical portion of the aggregate supply curve shows that at full employment an increase in the…

A: Macroeconomics studies the economy as a whole. It analyzes the national income, employment,…

Q: Refer to Figure. If the economy starts at c and 1, then in the short run, where does a decrease in…

A: Taxation imposed on goods results in higher investment as common people find it beneficial to invest…

Q: Consider the following statements about the business cycle. Which of the following statements is…

A: Business cycles are the alternate periods of expansion and decline in an economy's commercial…

Q: 2. Explain why E=Y and M.V=P.Q are equivalent to each other but can be used to give different…

A: E represents the expenditure or total spending in the economy. Y represents the total income earned…

Q: When an economy is operating in a positive output gap (Inflationary Gap) which of the following must…

A: An inflationary gap is where potential GDP is less than the actual real GDP in the economy.

Q: Suppose that the E.U. economy goes into an expansion. Canadian real GDP ________ and Canadian…

A: The expansion in the economy occurs when the economic activities are given a boost in the…

Question

What are the important mechanisms that reverse the effects of a recession in a modern economy? (Check all that apply.)
A. Labor supply increases due to an increase in real wages.
B. The multipliers on wages and employment return to normal.
C. Labor demand increases due to expansionary government policies.
D. Labor demand increases due to market forces.
What market forces might cause the labor demand curve to shift back to the right? (Check all that apply.)
A. Technological advances encourage firms to expand their activities.
B. The banking system recuperates and businesses are again able to use credit to finance their activities.
C. Excess inventory has been sold off.
D. Wage rigidity decreases.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Question 1

VIEW

Step 2: Question 2

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

1. The long-run aggregate supply curve reflects the amount of potential production when we are in full employment.Answer: True False 2. Long-term macroeconomic equilibrium occurs when short-term aggregate supply intercepts aggregate demand and long-term aggregate supply at the same point.Answer: True False 3. An economic cycle is the periodic but irregular movement of ups and downs in production; and is measured by fluctuations in nominal GDP.Answer: True False
how do we answer this?
Typically, when will the National Bureau of Economic Research (NBER) announce that the economy is in a recession? A. on the date that the recession begins B. typically, more than 10 years after the recession begins C. about six months before the recession begins D. a year or more after the recession has begun
1. A recessionary gap is the result of the: a.actual level of output falling below the full-employment level of output. b.full-employment level of output falling below the actual level of output. c.full-employment level of output falling below the actual level of consumption.
The housing market has weakened during every recession except which of the following? a. The Recession of 1974 b. The Recession of 1991 c. The Recession of 2001 d. The Recession of 2008
Do you believe democracy hinders or promotes economic growthSix Debates Over (Professor)Please discuss the six classic questions over macroeconomic policy as delineated in Chapter 23 of the course textbook. Choose two of the questions and take either a pro or con side for each question. Support your responses with a source or sources, including the course textbook (Mankiw).#2 Six Debates Over Macroeconomic Policy (Reading)Consider what causes the lags in the effect of monetary and fiscal policy on aggregate demand. What are the implications of these lags for the debate over active versus passive policy?Consider what might motivate a central banker to cause a political business cycle. What does the political business cycle imply for the debate over policy rules?Be prepared to explain how credibility might affect the cost of reducing inflation.Be prepared to explain why some economists are against a target of zero inflation?Consider what adverse effects might be caused by tax…
Please answer question 3
Suppose the economy is experiencing a recessionary gap. In the long run, if there is no government intervention, the nominal wages will ______, unemployment will _____, and the price level will _______. A.fall; rise; fall B.fall; fall; fall C.rise; fall; rise D.rise; rise; rise
please answer the following question: 1. Suppose that the economy has an inflationary gap. Which of the following policies would most likely help the situation?(Select All that Apply)A. Reductions in agricultural subsidies and veterans' benefits.B. Postponement of a highway construction program.C. Reductions in Federal tax rates on personal and corporate income.D. Increase in Federal tax rates on personal income.E. Provide American household with direct relief during a pandemic.F. Provide small businesses with funds to pay payroll.
What is most likely to occur during the expansionary phase of the business cycle? A.) Real GDP increases and unemployment decreases B.) Inflation increases and unemployment increases C.) Real GDP decreases and inflations increases D.) Real GDP decreases and unemployment decreases
Please answer question 1
12. If _____ is rising, it likely means that the economy is shrinking. A. consumer spending B. nominal GDP C. the Consumer Price Index D. the unemployment rate