1.According to the classical economic model, which of the following does not lead to an increase in the economy's potential output?
2.According to the Aggregate Demand curve, what is the relationship between inflation levels and the quantity of output produced?
3.Which of the following is NOT considered a form of monetary policy?
4.What does the relative-wage theory suggest as a reason for the presence of downward wage rigidity?
5.According to real business cycle theory, what is considered the primary cause of economic fluctuations?
6.What economic condition in the 1970s led to skepticism about the validity and nature of the Phillips curve?
7.According to classical economists, if input prices adjust almost instantly to changes in output prices, how would the Phillips curve be characterized?
8.What relationship does the Phillips curve illustrate?
9.What does potential GDP represent in terms of aggregate output?
10.Under what condition will the Phillips curve be vertical in the long run at the natural rate of unemployment?
11.According to classical economic theory, what is the reason some individuals remain unemployed?
12.According to the classical perspective, the aggregate supply curve is generally assumed to be which of the following?
13.Which of the following factors can lead to involuntary unemployment?
14.If the tax rate on earnings exceeding Rs 30,000 rises from 30% to 40%, what is the marginal tax rate for an individual earning Rs 31,000?
15.What type of unemployment occurs when an individual is willing to accept the current wage but is unable to secure employment?
16.Typically, how does the size of the labor force compare to the number of workers willing to accept job offers at a given real wage rate?
17.According to the classical economic theory, unemployment arises when the ____ exceeds its equilibrium point in the ____?
18.Which of the following are considered costs associated with inflation?
19.How is the long-run Phillips curve characterized at the equilibrium unemployment rate?
20.How can governments potentially increase inflationary pressures in the economy?