The property that macroeconomic variables fluctuate together in patterns that ex
ID: 1169796 • Letter: T
Question
The property that macroeconomic variables fluctuate together in patterns that exhibit strong regularities is called correlation. co-movement. coexistence. coincidence. Macroeconomic forecasting is made more difficult due to the fact that there is no regularity in comovements. deviations from trend in real GDP are persistent. turning points are hard to predict. consumption is smooth. As the quantity of labor increases, the marginal product of capital decreases. is constant. increases. may either increase or decrease.Explanation / Answer
16) This property is known as co movement. Co-movement is the similar movement of two or more variables. The direction of movement should be the same either upward or downward.
17) Option B is correct.
Forecasting is made difficult as the trend in real GDP is not persistent. It has high degree of variability and that's why we have to normalize the trend.
18) As the quantity of labor increases, capital becomes scarcer and marginal product of capital increases while marginal product of capital decreases.
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