For a Number of Years Canada and Many European Countries

question 66

Multiple Choice

For a number of years Canada and many European countries have had higher average unemployment rates than the United States.The Phillips curve suggests that these countries

• A)have higher average inflation rates than the United States.
• B)have long-run Phillips curves to the right of the United States'.
• C)may have less generous unemployment compensation or lower minimum wages.
• D)All of the above are consistent with the evidence on unemployment rates.

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Definitions:

Capital Lease

A long-term lease agreement that is classified as a purchase by the lessee for accounting purposes because it effectively transfers substantially all the risks and rewards of ownership.

Present Value

The current worth of a future sum of money or stream of cash flows, given a specified rate of return.

Lease Payments

Periodic payments made by a lessee to a lessor for the use of an asset under a lease agreement.

Implicit Lease Rate

The interest rate embedded in a lease agreement, representing the cost of leasing as an annualized percentage, which may not be explicitly stated.