Question : 11) As the recession persisted into 2009, the unemployment rate : 1244791

11) As the recession persisted into 2009, the unemployment rate in the United States rose to ________, the highest rate since the recession of 2001-2002 and the second highest since the Great Depression.

A) 5.5 percent

B) 9.3 percent

C) 17.6 percent

D) 25.1 percent

12) In the dynamic aggregated demand and aggregate supply model, if AD shifts faster than AS

A) inflation occurs.

B) deflation occurs.

C) stagflation occurs.

D) disinflation occurs.

13) Which of the following could explain why there is an increase in potential GDP but the equilibrium level of GDP does not rise?

A) SRAS shifted to the right by more than LRAS.

B) AD shifted to the right by more than SRAS.

C) AD shifted to the right by less than SRAS.

D) SRAS and AD do not shift.

14) All of the following are assumptions made by the dynamic model of aggregate demand and aggregate supply except

A) aggregate demand and potential real GDP decrease continuously.

B) the aggregate demand curve shifts to the right during most periods.

C) potential real GDP increases continuously.

D) the short-run aggregate supply curve shifts to the right except during periods when workers and firms expect higher wages.

15) Which of the following is one reason for the decline in aggregate demand that led to the recession of 2007-2009?

A) falling oil prices

B) an increase in net exports

C) the end of the housing bubble

D) a decline in government spending

16) When people became ________ concerned with the underlying value of their houses and became ________ with the expectations of the prices of their houses increasing, a housing bubble occurred.

A) less; less

B) less; more

C) more; less

D) more; more

17) During 2008, oil price increases

A) shifted the short-run aggregate supply curve farther to the left than similar increases had 30 years earlier.

B) shifted the aggregate demand curve farther to the right than similar increases had 30 years earlier.

C) did not shift the short-run aggregate supply curve as far to the left as similar increases had 30 years earlier.

D) shifted the aggregate demand curve farther to the left than similar increases had 30 years earlier.

18) The recession of 2007-2009 began in ________, with the end of the economic expansion that had begun in ________.

A) January 2007; April 1984

B) December 2007; November 2001

C) July 2007; August 2006

D) March 2007; March 1995

19) In the dynamic aggregated demand and aggregate supply model, inflation occurs if

A) AD shifts faster than SRAS.

B) AD shifts slower than SRAS.

C) SRAS shifts faster than AD.

D) LRAS shifts faster than AD.

20) Which of the following could explain why there is an increase in potential GDP but the equilibrium level of GDP falls?

A) SRAS shifted to the right by more than LRAS.

B) AD shifted to the right by more than SRAS.

C) AD shifted to the right by less than SRAS.

D) AD did not shift and SRAS shifted to the left.