- 26.1: Do rational expectations tend to look back at past experience while...
- 26.2: Legislation proposes that the government should use macroeconomic p...
- 26.3: Would it make sense to argue that rational expectations economics i...
- 26.4: Summarize the Keynesian and Neoclassical models.
- 26.5: Does neoclassical economics focus on the long term or the short ter...
- 26.6: Does neoclassical economics view prices and wages as sticky or flex...
- 26.7: What shape is the long-run aggregate supply curve? Why does it have...
- 26.8: What is the difference between rational expectations and adaptive e...
- 26.9: A neoclassical economist and a Keynesian economist are studying the...
- 26.10: Do neoclassical economists tend to focus more on long term economic...
- 26.11: Do neoclassical economists tend to focus more on cyclical unemploym...
- 26.12: Do neoclassical economists see a value in tolerating a little more ...
- 26.13: If aggregate supply is vertical, what role does aggregate demand pl...
- 26.14: What is the shape of the neoclassical long-run Phillips curve? What...
- 26.15: When the economy is experiencing a recession, why would a neoclassi...
- 26.16: If the economy is suffering through a rampant inflationary period, ...
- 26.17: If most people have rational expectations, how long will recessions...
- 26.18: Explain why the neoclassical economists believe that the government...
- 26.19: Economists from all theoretical persuasions criticized the American...
- 26.20: Is it a logical contradiction to be a neoclassical Keynesian? Explain.
- 26.21: Use Table 26.3 to answer the following questions. Price Level Aggre...
Solutions for Chapter 26: The Neoclassical Perspective
Full solutions for Principles of Economics | 2nd Edition
total revenue minus total explicit cost
Arrow’s impossibility theorem
a mathematical result showing that, under certain assumed conditions, there is no scheme for aggregating individual preferences into a valid set of social preferences
an economy that does not interact with other economies in the world
the proposition that if private parties can bargain without cost over the allocation of resources, they can solve the problem of externalities on their own
two goods for which an increase in the price of one leads to a decrease in the demand for the other
the quantity of output that minimizes average total cost
the property of distributing economic prosperity uniformly among the members of society
a situation in which the market price has reached the level at which quantity supplied equals quantity demanded
federal funds rate
the interest rate at which banks make overnight loans to one another
the automatic correction by law or contract of a dollar amount for the effects of inflation
negative income tax
a tax system that collects revenue from high-income households and gives subsidies to lowincome households
net capital outflow
the purchase of foreign assets by domestic residents minus the purchase of domestic assets by foreigners
claims that attempt to prescribe how the world should be
the amount a seller is paid for a good minus the seller’s cost of providing it
the ability of an individual to own and exercise control over scarce resources
the amount of a good that buyers are willing and able to purchase
the fraction of deposits that banks hold as reserves
a cost that has already been committed and cannot be recovered
an event that directly alters firms’ costs and prices, shifting the economy’s aggregate supply curve and thus the Phillips curve
a worker association that bargains with employers over wages, benefits, and working conditions