Real income will rise from one year to the next if nominal income:
A. Falls and the price level falls faster
B. Rises and the price level rises faster
C. Falls and the price level rises
D. Falls faster than the price level
A. Falls and the price level falls faster
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Which of the following theories states that people who are highly risk-averse are less likely to engage in high-risk activities?
a. The theory of moral hazard b. The theory of adverse selection c. The propitious selection theory d. The death spiral theory
If resources are misallocated in a perfectly competitive market, then, in the long run, profit opportunities will:
A. not bring about a reallocation of resources unless firms are subsidized. B. not bring about a reallocation of resources unless there is government regulation. C. bring about a less efficient allocation of resources. D. bring about a more efficient allocation of resources.
Using fiscal and monetary policies to deal with a demand shock ______.
a. will prevent the occurrence of a supply shock b. will create a negative supply shock c. is more effective than using them to deal with a supply shock d. is less effective than using them to deal with a supply shock
How is the R2 value calculated, and what information does this give you?
What will be an ideal response?