A graph showing the inverse relationship between the economy's rate of unemployment and rate of ...

A graph showing the inverse relationship between the economy's rate of unemployment and rate of inflation is called the:
 a. Laffer curve.
  b. aggregate expenditure model.
  c. Keynesian cross.
  d. Phillips curve.
  e. consumption curve.

QUESTION 2

Suppose that the consumer price index (CPI) was 160 in Year X and 166 in Year Y, inflation during Year Y was approximately:
 a. zero; prices were stable.
  b. 3.8 percent.
  c. 6 percent.
  d. 66 percent.

QUESTION 3

The school of economic thought which argues that through tax reductions, and deregulation, government creates the proper incentives for the private sector to increase aggregate supply is known as the:
 a. rational expectations school.
  b. neo-Keynesian school.
  c. supply-side school.
  d. new classical school.
  e. classical school.

QUESTION 4

Which of the following statements is true?
 a. The Phillips curve has always been stable.
  b. If the Phillips curve shifts outward to the right this illustrates a greater tradeoff between unemployment and inflation.
  c. Keynesian economics assumes a vertical Phillips curve.
  d. According to the natural rate hypothesis the Phillips curve is downward sloping.
  e. All of these.

QUESTION 5

Suppose that the consumer price index of a country was 160 at Year X and 168 at the end of Year Y. What was the country's inflation rate during Year Y?
 a. 5 percent.
  b. 8 percent.
  c. 60 percent.
  d. 68 percent.

QUESTION 6

Those who favor government policies to stimulate the economy by creating incentives for individuals and businesses to increase their productive efforts are supporting:
 a. supply-side economics.
  b. Keynesian economics.
  c. monetarist economics.
  d. Marxian economics.