Suppose Each of the Following Rows Represents the Choice Faced

question 106

Multiple Choice

Suppose each of the following rows represents the choice faced by policy makers given the current set of U.S. institutions and technology. What is the opportunity cost of reducing unemployment from 8 percent to 4 percent? $\begin{array}{|c|c|}\hline \text { Unemployment }& \text { Inflation } \\\hline 10 & 3 \\\hline 8 & 4 \\\hline 6 & 5 \\\hline 5 & 7 \\\hline 4 & 10 \\\hline\end{array}$

• A)4 percentage points of unemployment
• B)6 percentage points of unemployment
• C)6 percentage points of inflation
• D)4 percentage points of inflation

---

Definitions:

Effect Size

A quantitative measure of the magnitude of the experimental effect, indicating the difference between two groups' means relative to the standard deviation of the scores.

Break Even

The point at which total costs and total revenue are equal, resulting in no net loss or gain.

Standard Deviation

Standard deviation is a statistical measure that quantifies the amount of variance or dispersion of a set of data values from the mean.

Net Benefit

The positive difference between all benefits received from a particular action or project after subtracting all associated costs.