If an Economy Operates on Its Production Possibilities Frontier, the Natural

question 100

Multiple Choice

If an economy operates on its production possibilities frontier, the natural unemployment rate must be:

• A)zero.
• B)positive.
• C)negative.
• D)at 1 percent.
• E)at 5 percent.

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Definitions:

Assignee

The party to whom rights or interests are transferred by another, often used in context of contracts, leases, or other agreements.

American Rule

A legal principle stating that each party in a lawsuit is responsible for paying its own attorney fees, except as otherwise provided by statute or contract.

English Rule

A legal principle where the losing party in litigation is required to pay the legal costs of the winning party.

Obligor

A party that is bound by a legal obligation to another, known as the obligee.