1.The unemployment rate measures the number of unemployed people expressed as a percentage of the total number of employed.*

True

False

2.Disinflation is the term used when overall prices are decreasing.

True

False

3.The short-run equilibrium level of real output and the price level are determined by the intersection of the aggregate demand curve and the short-run aggregate supply curve.*

True

False

4.Another name for the contractionary phase of a business cycle is the recession.*

2 points

True

False

5.Personal income is the amount individuals receive after they pay taxes.

True

False

6.The government can use a flat tax to redistribute income

True

False

7.The two major sources of government revenue are taxes and transfer payments.*

True

False

8.A cut in corporate profit taxes can lead to an increase in investment spending, aggregate demand, and future economic growth.*

True

False

9.Peak is a cycle in the economy where real GDP is rising significantly*

True

False

10.The long-run aggregate supply curve is horizontal

True

False