Which of the following events is likely to increase unemployment and drive the price level down? Select one: a. The U.S. government lowering income and corporate taxes b. Strong economic growth in Mexico, one of our largest trade partners c. The Fed reducing the supply of money through an open market operations d. An increase in the price of fuel due to rising demand from India and China e. A rise in minimum wage

NEWS WIRE NORTH KOREA'S ROCKETS DEEPEN FOOD CRISIS   North Korea's Rocket Launches Cost $1.3 Billion   North Korea's rocket program is costly. In December 2012 North Korea successfully launched a long-range rocket carrying a satellite into space. That feat cost $300 million. The entire cost of the rocket program last year - including the failed launch in April - totaled about $1.3 billion according to estimates by South Korea experts. With that much money North Korea could have purchased 4.6 million tons of corn - enough to feed its population for 4-5 years. North Korea's ambitious nuclear program costs nearly triple that amount. The burden of North Korea's military program is evident in widespread poverty and periodic starvation.   Source: News accounts of December 2012 - January 2013.     According to the News Wire, what is the opportunity cost of North Korea's rocket program in terms of corn for North Korea's 25 million people?           million tons of corn

Scenario : The US enters into a new free trade agreement. How does this affect Aggregate Demand and Supply? What are the corresponding effects on Unemployment and Inflation as a result? What fiscal and or monetary policies would you recommend to bring the economy back to Long Run Equilibrium? Why would or why wouldn't you support this trade policy?

Achieving the Three Goals for the United States The government's role is to prevent unemployment and prevent inflation at the same time. If the government focuses too much on preventing inflation and slows down the economy, we will have unemployment. If the government focuses too much on limiting unemployment and overheats the economy, we will have inflation. Severity Unemployment 6% or less 6.5-8% 8.5% or more 1-4% 5-8% Inflation 9% or more GDP Growth 2.5-5% 1-2% .5% or less