If the Unemployment Rate Is Greater Than the NAIRU

question 36

Multiple Choice

If the unemployment rate is greater than the NAIRU,

• A)there will be upward pressure on wages.
• B)the AS curve will shift upward.
• C)there is a negative output gap.
• D)real national income is above potential GDP.
• E)there is an inflationary gap.

Perform and interpret vertical and horizontal analyses of financial statements.

Analyze a company's performance through trend analysis.

Calculate and understand the significance of the current ratio, acid test ratio, and inventory turnover.

Perform a common-size income statement analysis using net sales as the base.

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Definitions:

Labor

The human effort (physical or mental) that is used in the production of goods and services.

Producer Surplus

The difference between the actual amount producers receive for a good and the minimum amount they would be willing to accept.

Firm

A business enterprise or establishment engaged in commercial, industrial, or professional activities.

Normal Good

A type of good for which demand increases when consumer income rises, and falls when consumer income decreases.