Households tend to increase their spending during a recession because they realize that more spending will cause firms to hire more workers and the problem of unemployment will be solved.” Do you agree or disagree? Explain.

Explain what happens to the economy if there is a temporary consumption boom that lasts for one period and the central banks keeps the nominal interest rate unchanged

Discuss two methods that can be used to determine the full-employment rate of unemployment and what they suggest for the relationship between inflation and unemployment.

Which of the following are true of an economy operating with a negative GDP gap? Check all that apply. a)A worker with a college degree is more likely to be unemployed than a worker without one. b)The suicide rate, crime, and political unrest may be higher than in an economy with a similar potential GDP and a lower unemployment rate. c)Actual real GDP is less than potential real GDP. d)A teenage worker is more likely to be unemployed than an older worker.